伊士曼化學 (EMN) 2017 Q4 法說會逐字稿

Good day, everyone, and welcome to the Eastman Chemical Company Fourth Quarter Full Year 2017 Conference Call. Today's conference is being recorded. This call is being broadcast live on the Eastman's website, www.eastman.com.

大家好，歡迎參加伊士曼化學公司2017年第四季全年電話會議。今天的會議正在錄製中。這場電話會議正在伊士曼網站 www.eastman.com 上現場直播。

We will now turn the call over to Mr. Greg Riddle of Eastman Company -- Chemical Company, Investor Relations. Please go ahead, sir.

現在我們將電話轉給伊士曼公司（化學公司）投資者關係部門的 Greg Riddle 先生。先生，請繼續。

Thank you, Jennifer, and good morning, everyone, and thanks for joining us. On the call with me today are Mark Costa, Board Chair and CEO; Curt Espeland, Executive Vice President and CFO; and Louis Reavis, Manager, Investor Relations.

謝謝你，詹妮弗，大家早安，謝謝你們加入我們。今天與我一起參加電話會議的有董事會主席兼首席執行官馬克·科斯塔 (Mark Costa)、執行副總裁兼首席財務官科特·埃斯佩蘭 (Curt Espeland) 和投資者關係經理路易斯·裡維斯 (Louis Reavis)。

Before we begin, I'll cover 2 items. First, during this presentation, you will hear certain forward-looking statements concerning our plans and expectations. Actual events or results could differ materially. Certain factors related to future expectations are or will be detailed in the company's fourth quarter and full year 2017 financial results news release and in our filings with the Securities and Exchange Commission, including the Form 10-Q filed for third quarter 2017 and the Form 10-K to be filed for 2017.

在我們開始之前，我將介紹兩件事。首先，在本次演示中，您將聽到有關我們的計劃和期望的一些前瞻性陳述。實際事件或結果可能有重大差異。與未來預期相關的某些因素已在或將在公司 2017 年第四季度和全年財務業績新聞稿以及我們向美國證券交易委員會提交的文件中詳細說明，包括 2017 年第三季度提交的 10-Q 表和即將提交的 2017 年 10-K 表。

Second, earnings referenced in this presentation exclude certain non-GAAP and unusual items. Reconciliations to the most directly comparable GAAP financial measures and other associated disclosures, including a description of excluded and adjusted items are available in the fourth quarter full year 2017 financial results news release, which can be found on our website, www.eastman.com, in the Investors section. Projections of future earnings exclude any noncore or unusual items.

其次，本報告中提到的收益不包括某些非公認會計準則項目和非常規項目。與最直接可比較的 GAAP 財務指標及其他相關披露的對賬，包括排除項目和調整項目的描述，均可在 2017 年第四季度全年財務業績新聞稿中找到，該新聞稿可在我們的網站 www.eastman.com 的“投資者”部分找到。未來收益預測不包括任何非核心或不尋常的項目。

And with that, I'll turn the call over to Mark.

說完這些，我會把電話轉給馬克。

Good morning, everyone. I'll start on Slide 3. 2017 was a strong year for Eastman as we made great progress in our strategy to transform towards a specialty portfolio and create attractive value for our shareholders. I'm pleased to report that we met or exceeded the financial targets that we set last January.

大家早安。我將從幻燈片 3 開始。 2017 年對伊士曼來說是強勁的一年，因為我們在向專業產品組合轉型的策略方面取得了巨大進展，並為股東創造了有吸引力的價值。我很高興地報告，我們達到或超過了去年一月設定的財務目標。

On the EPS front, we exceeded our goals through the strength of our performance of our innovative specialty businesses. The key driver to the success was our continued strong growth, improving product mix and cost structure leverage.

在每股盈餘方面，我們憑藉創新專業業務的強勁表現超越了我們的目標。成功的關鍵驅動力是我們持續強勁的成長、不斷改善的產品組合和成本結構槓桿。

In 2017 we delivered over 7% volume growth in our 2 specialty segments combined, which is more than double the underlying markets. Strong contributors included many of our premium products such as Tritan; Saflex acoustics and heads-up display interlayers; Crystex tire additives, tire resins, and performance films. In particular, growth in premium products has been a key driver for the Advanced Materials segment, and we're seeing this trend accelerate for Additives & Functional Products.

2017 年，我們兩個專業領域的總銷量成長超過 7%，是基礎市場的兩倍多。強大的貢獻者包括我們的許多優質產品，如 Tritan、Saflex 聲學和平視顯示器夾層、Crystex 輪胎添加劑、輪胎樹脂和​​性能薄膜。尤其是高端產品的成長已成為先進材料領域的主要驅動力，而我們看到添加劑和功能產品的趨勢正在加速。

We achieved the highest rate of new product commercializations from our innovation growth portfolio in our history. We also benefited from higher reliability suppliers as our Chinese competitors faced stronger environmental enforcement, and we completed the construction of 2 of our new specialty plants in Malaysia to support our future growth. At the same time, we took actions to reduce cost in a disciplined way, which has allowed us to strategically invest in long-term growth and further improve our cost structure. As I said before, we are creating our own growth through innovation and leadership in specialty markets.

我們的創新成長組合實現了史上最高的新產品商業化率。由於我們的中國競爭對手面臨更嚴格的環境執法，我們也受益於更高可靠性的供應商，並且我們在馬來西亞完成了 2 家新專業工廠的建設，以支持我們未來的成長。同時，我們採取了有紀律的措施來降低成本，這使我們能夠策略性地投資於長期成長並進一步改善我們的成本結構。正如我之前所說，我們正在透過在專業市場的創新和領導來創造自己的成長。

Our cash engine generated an impressive $1 billion of free cash flow for the year, about a 7% yield, which enabled an increasing dividend, further deleveraging and an accelerating rate of share repurchases. And we increased our dividend by 10% in 2017, the eighth straight year of increases. Over that time, we have more than doubled our dividend, providing an attractive yield to investors.

我們的現金引擎在當年產生了令人印象深刻的 10 億美元自由現金流，收益率約為 7%，這使得股息增加、進一步去槓桿化和股票回購速度加快。2017 年，我們將股利提高了 10%，這是我們連續第八年增加股利。在此期間，我們的股息增加了一倍多，為投資者提供了相當吸引力的收益。

Overall during 2017, we returned approximately $650 million to stockholders through share repurchases and dividends. These results are clear proof that we are on track in executing our strategy from innovating through our Enterprise to managing our cost, to pricing discipline to returning cash to our stockholders.

整體而言，2017 年我們透過股票回購和股利向股東返還了約 6.5 億美元。這些結果清楚證明，我們正在正確執行我們的策略，從企業創新到管理成本、定價紀律到向股東返還現金。

Next on Slide 4, as you know in early October, we had an operational incident in the coal gasification area of our Kingsport site. First, I've said it before and I want to say it again, I want to compliment the extraordinary professionalism and the safety-first focus of our operations team. This was a significant event and we're exceptionally proud of the actions of our team. Our recovery team had twice a day, 7 days a week for 3 month, solving problems and driving results. The team came together with the Eastman can do attitude and demonstrated how Eastman is exceptional at rising to a challenge.

接下來是幻燈片 4，如您所知，10 月初，我們金斯波特工廠的煤氣化區發生了一起營運事故。首先，我之前說過，現在我想再說一遍，我要讚揚我們營運團隊非凡的專業精神和安全第一的關注。這是一場重大事件，我們為團隊的行動感到無比自豪。我們的恢復團隊每週 7 天、每天兩次，持續 3 個月，解決問題並取得成果。整個團隊團結一致，秉持「伊士曼能做到」的態度，展現了伊士曼在應對挑戰方面的卓越能力。

Second, our response to this incident is a superb example of how we both delivered superior reliability for our customers and are minimizing the financial impact of the incident on our earnings. Our teams worked tirelessly to repair the facility. We also implemented alternate processes to maintain operations of downstream derivative facilities of coal gas. We had an absolutely flawless startup, which is a testament to our talented engineering and manufacturing teams. And in the end, there was a zero impact to our derivative customers.

其次，我們對這一事件的反應是一個極好的例子，說明我們如何既為客戶提供了卓越的可靠性，又最大限度地減少了這一事件對我們收益的財務影響。我們的團隊不懈地努力修復該設施。我們也實施了替代流程來維持煤氣下游衍生設施的運作。我們的啟動過程絕對完美，這證明了我們擁有優秀的工程和製造團隊。最終，這對我們的衍生性商品客戶沒有任何影響。

Third, this impressive timeline to get back up is due to the significant advantages we have in the scale and integration at our Tennessee site, which is one of the largest integrated chemical facilities in the U.S. Our innovative production systems across the 4 segments enabled us to make complex choices across the site, which was essential in avoiding a site-wide disruption. Our significant scale enables us to have dedicated experts and large-scale fabrication and engineering resources, who rapidly and safely repaired the facility.

第三，如此令人印象深刻的恢復時間表歸功於我們在田納西工廠的規模和整合方面擁有的顯著優勢，該工廠是美國最大的綜合化工設施之一。我們涵蓋四個部門的創新生產系統使我們能夠在整個工廠範圍內做出複雜的選擇，這對於避免整個工廠的中斷至關重要。我們擁有龐大的規模，擁有專業的專家和大規模的製造和工程資源，能夠快速且安全地修復設施。

For example, we rebuilt a five-story pipe bridge, with 117 pipes and there were no leaks on startup. We replaced hundreds of valves, some of which were over 2,000 pounds. We rebuilt in our own big shop a number of new vessels, some of which had walls that were 3 inches thick. Our scale in supply chain and procurement also played a critical role in sourcing material and balancing the needs of our customers. This is another example of how we're exceptional in managing large complex facilities.

例如，我們重建了一座五層樓高的管橋，共有117根管道，啟動時沒有出現任何洩漏。我們更換了數百個閥門，其中一些重量超過 2,000 磅。我們在自己的大車間重建了許多新容器，其中一些容器的壁厚達 3 英吋。我們的供應鏈和採購規模在採購材料和平衡客戶需求方面也發揮了關鍵作用。這是我們在管理大型複雜設施方面表現卓越的另一個例子。

I'll let Curt cover the financial implications as he reviews the corporate results next. With that, I'll turn it over to Curt.

接下來，我將讓 Curt 在審查公司績效時介紹財務影響。說完這些，我會把話題交給 Curt。

Thanks, Mark, and good morning, everyone. Continuing on Slide 4, let me cover 3 financial aspects related to the coal gasification incident.

謝謝，馬克，大家早安。延續第 4 張投影片，讓我介紹一下與瓦斯化事件相關的 3 個財務面向。

First, the net cost resulting from the incident are excluded from fourth quarter and full year earnings results and the net earnings recovery in 2018 will also be excluded. Second, thanks to our team's diligent effort resulting in an accelerated timeframe from bringing the site back up as well as higher insurance recovery resulting from an increase in related capital expenditures, we anticipate the net financial impact of the incident will be between $25 million to $50 million lower than previously anticipated.

首先，該事件造成的淨成本將被排除在第四季度和全年盈利結果之外，2018 年的淨利潤恢復也將被排除在外。其次，由於我們團隊的辛勤努力，加快了恢復現場的時間，並且由於相關資本支出的增加而提高了保險賠償額，我們預計該事件的淨財務影響將比之前預期的低 2500 萬至 5000 萬美元。

In fourth quarter, the net cost of the disruption and to the repair and reconstruction of the site were $112 million. In addition, loss sales attributed to the incident were $40 million in the fourth quarter of 2017, primarily in the Chemical Intermediates segment.

第四季度，停電以及現場修復和重建的淨成本為 1.12 億美元。此外，該事件導致 2017 年第四季銷售額損失 4,000 萬美元，主要集中在化學中間體部門。

Finally, the net cash impact of the incident is expected to be approximately $50 million to $70 million, mostly impacting free cash flow in 2018. The free cash flow impact on fourth quarter 2017 was minimal as the net cost and capital expenditures related to the incident were offset by a drawdown of inventory and increase in trade payables.

最後，該事件的淨現金影響預計約為5,000萬至7,000萬美元，主要影響2018年的自由現金流。由於與該事件相關的淨成本和資本支出被庫存減少和貿易應付款項增加所抵消，因此對 2017 年第四季的自由現金流的影響微乎其微。

Now moving to our fourth quarter corporate results on Slide 5. We delivered solid earnings for the quarter. The increase in revenue largely reflected strong growth from our high-margin specialty businesses, along with continued improvement in Chemical Intermediates, more than offsetting a decline in Fibers. Chemical Intermediates revenue improved despite the negative impact of loss sales of approximately $40 million attributed to the coal gasification disruption. Operating earnings increased as growth in Additives & Functional Products, Advanced Materials and Chemical Intermediates more than offset a decline in Fibers.

現在轉到投影片 5 的第四季公司業績。本季我們實現了穩健的獲利。營收的成長主要反映了我們高利潤特種業務的強勁成長，以及化學中間體的持續改善，足以抵消纖維業務的下滑。儘管煤氣化中斷造成約 4,000 萬美元的銷售損失，帶來負面影響，但化學中間體收入仍有改善。由於添加劑和功能產品、先進材料和化學中間體的成長抵消了纖維的下滑，營業收益增加。

Next on to Slide 6. Looking at the full year, we delivered strength results despite a slow growth world, reflecting the strong and robustness of our strategy to transform into a specialty portfolio. Overall sales revenue increased as strong growth from our high-margin specialty businesses, along with continued improvement in Chemical Intermediates, more than offset a headwind in Fibers. Our operating results increased as increases in Additives & Functional Products, Advanced Materials and Chemical Intermediates more than offset a decline in Fibers. And we are growing operating earnings, while we continue to invest in growth for both the near term and long term. Our operating margin for the year was over 17%, slightly higher than 2016. And our adjusted EBITDA margin was over 23%, which remains one of the most attractive in our industry. Earnings per share increased 13%, with higher operating earnings contributing almost 8% of the growth.

接下來是投影片 6。縱觀全年，儘管全球經濟成長緩慢，我們仍然取得了強勁的業績，這反映了我們向專業投資組合轉型的策略的強勁和穩健。由於高利潤特種業務的強勁增長以及化學中間體的持續改善，整體銷售收入有所增長，足以抵消纖維業務的不利影響。由於添加劑和功能產品、先進材料和化學中間體的成長超過了纖維的下降，我們的經營績效也有所成長。我們的營業利潤正在成長，同時我們繼續投資於短期和長期的成長。我們全年的營業利益率超過 17%，略高於 2016 年。我們的調整後 EBITDA 利潤率超過 23%，仍然是我們行業中最具吸引力的利潤率之一。每股收益成長 13%，其中營業收益增加貢獻了近 8% 的成長。

Moving next to the segment results beginning on Slide 7 and starting with Advanced Materials, which delivered another year of strong growth driven by our innovation platforms. Fourth quarter earnings increased year-over-year due to higher sales volume, particularly from double-digit growth of high-margin innovative products and improved product mix, partially offset by higher growth spend and startup costs of the new PVB resin capacity in Malaysia and hurricane-related costs.

接下來從投影片 7 開始查看分部業績，首先介紹先進材料，在創新平台的推動下，先進材料又實現了一年的強勁成長。第四季獲利年增，原因是銷售量增加，特別是高利潤創新產品的兩位數成長和產品組合的改善，但被馬來西亞新 PVB 樹脂產能的成長支出和啟動成本以及颶風相關成本部分抵銷。

For the year, sales revenue increased due to the improved product mix from higher sales volume of premium products, including Tritan copolyester, Saflex acoustic interlayers and performance films. Operating earnings increased for the year, primarily driven by higher sales volume, lower unit costs due to higher capacity utilization and improved product mix of premium products, partially offset by higher growth spend. Advanced Materials' strong operating margin was maintained at over 19%. These results reflect execution of a multiyear strategy to deliver strong earnings growth. Overall solid results for 2017, which continues Advanced Materials' track record of success and reflects the high level of returns given the investments we have made.

本年度，由於 Tritan 共聚酯、Saflex 隔音夾層和高性能薄膜等優質產品的銷售增加，產品結構得到改善，銷售收入有所增加。本年度營業利潤有所增長，主要由於銷售量增加、產能利用率提高導致單位成本降低以及高端產品組合改善，但增長支出增加部分抵消了這一增長。先進材料公司的強勁營業利潤率維持在19%以上。這些結果反映了多年策略的實施，以實現強勁的獲利成長。2017 年的整體業績穩健，延續了先進材料的成功記錄，並反映了我們所做投資的高回報。

Looking to, to 2018, we expect strong earnings growth in 2017 as Advanced Materials executed strategy for mid-single-digit volume growth, mix improvement and fixed cost leverage. We continue to deliver compelling proof of our ability to drive growth through our innovation and market development.

展望2018年，我們預計2017年獲利將強勁成長，因為先進材料公司實施了中位數個位數銷售成長、產品組合改善和固定成本槓桿策略。我們不斷提供令人信服的證據，證明我們有能力透過創新和市場開發來推動成長。

Now to the Additives & Functional Products on Slide 8, which had another outstanding quarter. Fourth quarter sales revenue increased 19% due to very strong sales volume from most product lines, a favorable shift in foreign currency exchange rates and higher selling prices. This impressive growth came from multiple sources. Our improved commercial execution in heat transfer fluids led to a number of wins in solar energy, strong growth in tire additives due to innovation in our tire resins and superior operational reliability and strong growth in animal nutrition and care chemicals. We also made good progress in improving our pricing on the strengths of our value proposition to our customers.

現在就來看看幻燈片 8 上的添加劑和功能產品，該部門又度過了一個出色的季度。第四季銷售收入成長 19%，得益於大多數產品線的銷售量非常強勁、外匯匯率的有利轉變以及銷售價格的上漲。這一令人印象深刻的成長來自多個方面。我們在傳熱流體領域商業執行力的提升，使我們在太陽能領域取得了多項勝利，輪胎添加劑業務由於輪胎樹脂的創新和卓越的操作可靠性而實現了強勁增長，動物營養和護理化學品業務也實現了強勁增長。我們也憑藉著對客戶的價值主張優勢，在改善定價方面取得了良好進展。

Operating earnings increased primarily due to higher sales volume, higher selling prices and fixed cost leverage. For the year, sales revenue increased double digits, primarily due to 10% higher sales volume, which is across most of the segment as well as higher selling prices. Operating earnings increased 8%, primarily due to higher sales volume, fixed cost leverage related to strong volume growth and higher selling prices.

營業利潤的成長主要得益於銷售量的增加、銷售價格的上漲、固定成本的槓桿作用。本年度，銷售收入實現了兩位數成長，主要由於銷售量增加了 10%（涵蓋了大部分細分市場）以及銷售價格上漲。營業利潤成長 8%，主要由於銷售量增加、與強勁銷售成長相關的固定成本槓桿、銷售價格上漲。

Looking at full year 2018, we expect solid earnings growth. We expect the continued solid growth in tire additives and animal nutrition will be partially offset by some headwinds in adhesives and a tough comp for heat transfer fluids due to the timing of solar projects. We will also have higher costs associated with growth investments. All in, Additives & Functional Products is well positioned to deliver solid earnings growth for the year.

展望2018年全年，我們預期獲利將穩健成長。我們預計輪胎添加劑和動物營養的持續穩健增長將被粘合劑的一些阻力以及太陽能項目時機導致的傳熱流體的艱難競爭所部分抵消。我們也將承擔與成長投資相關的更高成本。總而言之，添加劑和功能產品業務預計今年將實現穩健的獲利成長。

Now the Chemical Intermediates on Slide 9. Fourth quarter sales revenue increased due to higher selling prices attributed to higher raw material costs and continued improved market conditions. The increase was partially offset by lower sales volume, particularly of acetyl derivative products due to the coal gasification incident. Fourth quarter operating earnings increased slightly, primarily due to higher selling prices and lower commodity hedge costs, partially offset by lower sales volume and higher raw material and energy costs.

現在是幻燈片 9 上的化學中間體。第四季銷售收入增加是由於原材料成本上升和市場條件持續改善導致銷售價格上漲。但這一增長被銷量下降（尤其是因煤氣化事件導致的乙醯衍生產品銷售下降）部分抵消。第四季營業利潤略有成長，主要由於銷售價格上漲和商品對沖成本下降，但被銷售量下降和原材料及能源成本上漲部分抵銷。

For full year, operating earnings increased primarily due to higher selling prices, lower commodity hedge costs, lower scheduled maintenance costs and lower operating costs, partially offset by higher raw material and energy costs. Sales volume was down somewhat, with growth in our specialty businesses consuming intermediates, that would have been sold to the market resulting in corporate mix upgrade. This is in line with our strategy for Chemical Intermediates, which includes supporting growth in the specialty businesses.

全年營業利潤的成長主要得益於銷售價格上漲、商品對沖成本降低、定期維護成本降低和營運成本降低，但原材料和能源成本的上漲部分抵消了這一增長。銷售量有所下降，因為我們的特種業務的成長消耗了原本可以銷售到市場的中間體，導致了企業組合的升級。這符合我們的化學中間體策略，其中包括支援專業業務的成長。

Looking at full year 2018, we expect similar results to 2017. It looks like we're off to a good start here in the first quarter, however, we are expecting olefin margins to compress somewhat towards the back half of the year. We also have higher scheduled maintenance costs during the year, which we will work to offset with productivity. Overall, Chemical Intermediates is set up for 2018 earnings to be similar to 2017, which would be a good performance.

展望 2018 年全年，我們預期業績將與 2017 年類似。看起來我們在第一季有一個良好的開端，然而，我們預計烯烴利潤率在今年下半年會壓縮。我們今年的計畫維護成本也較高，我們將努力提高生產力來抵銷這項成本。總體而言，化學中間體 2018 年的收益將與 2017 年相似，這將是一個好的表現。

I'll finish up the segment review with Fibers on Slide 10. Full-year sales revenue decreased primarily due to lower selling prices, particularly for acetate tow attributed to lower industry capacity utilization. A bright spot for the year was growth in acetate yarn, which increased over 10%, reflecting early success of our innovation initiatives. Operating earnings for the year declined due to lower selling prices and lower sales volume, partially offset by lower operating costs resulting from recent actions. However, operating earnings improved in the second half of 2017 and were 10% higher than the first half, reflecting the actions we've taken to stabilize the business.

我將在第 10 張幻燈片上完成關於 Fibers 的片段回顧。全年銷售收入下降主要是由於銷售價格下降，尤其是醋酸絲束因行業產能利用率下降而導致的。本年度的一個亮點是醋酸紗線的成長，增幅超過 10%，反映了我們創新舉措的早期成功。由於銷售價格下降和銷售量下降，本年度營業利潤有所下降，但近期措施導致的營業成本降低部分抵銷了這一影響。然而，2017年下半年營業利潤有所改善，比上半年成長了10%，這反映了我們為穩定業務所採取的措施。

Looking forward, we expect 2018 earnings to be stable or somewhat higher than earnings in 2017. We expect tow volumes to be stable with somewhat lower prices from competitive activity, offset by an aggressive productivity program including raw material costs. We also expect continued growth from our innovation efforts and we'll tell you more about this great success next week. One final point, we expect first quarter 2018 to be in line with fourth quarter 2017, with an improvement in earnings for the remaining 3 quarters as the benefits of lower costs flow through inventory.

展望未來，我們預計 2018 年獲利將與 2017 年獲利持平或略有上升。我們預計，由於競爭活動，拖車數量將保持穩定，價格將略有下降，但包括原材料成本在內的積極的生產力計劃將抵消這一影響。我們也期望我們的創新努力能夠持續成長，下週我們將向您詳細介紹這項巨大成功。最後一點，我們預計 2018 年第一季的獲利將與 2017 年第四季持平，隨著成本降低帶來的好處透過庫存傳導，剩餘三個季度的獲利將有所改善。

On Slide 11, I'll transition to an overview of our cash flow and other financial highlights for 2017. We did an excellent job of generating cash in 2017, with an operating cash flow of over $1.6 billion. Capital expenditures totaled $649 million, including approximately $50 million for coal gasification repairs and reconstruction. Free cash flow for the year was just over $1 billion, the best year of free cash flow in our history and a very attractive free cash flow conversion rate of over 90%. Another testament to the quality of our portfolio and the capabilities of the Eastman team.

在第 11 張投影片上，我將概述我們的現金流量和 2017 年的其他財務亮點。2017 年，我們在現金創造方面做得非常出色，經營現金流超過 16 億美元。資本支出總計 6.49 億美元，其中包括約 5,000 萬美元用於煤氣化修復和重建。全年自由現金流略高於 10 億美元，是我們史上自由現金流最好的一年，自由現金流轉換率超過 90%，非常吸引人。這再次證明了我們的產品組合品質和伊士曼團隊的能力。

And we expect that to continue in 2018, with free cash flow expectation greater than $1.1 billion. This reflects cash from continued earnings growth, the benefit of tax reform and lower capital expenditures, partially offset by the negative cash impact of the operational incident and increases in working capital requirements, given our expected growth in rising raw material environment.

我們預計這種趨勢將在 2018 年持續下去，自由現金流預計將超過 11 億美元。這反映了持續獲利成長、稅收改革的好處和較低的資本支出帶來的現金，但考慮到我們預期原材料上漲環境下的成長，營運事件和營運資本需求增加帶來的負面現金影響部分抵消了這一影響。

For 2018, we expect capital expenditures to moderate to to $550 million. This reflects the nearing of completion of several large growth projects as well as an additional $20 million to complete the repairs of the coal gas facility. In addition, given the expected benefits of tax reform, we are investing an additional $25 million for low cost to bottom mix and higher-return small capital projects to meet increasing demand for a variety of our specialties.

2018 年，我們預計資本支出將降至 5.5 億美元。這反映了幾個大型成長項目即將完工，以及額外的 2000 萬美元用於完成煤氣設施的修復。此外，考慮到稅制改革的預期效益，我們將額外投資 2,500 萬美元用於低成本、低組合、高回報的小型資本項目，以滿足對我們各種專業領域日益增長的需求。

And we'll continue to put our free cash flow to work in a balanced and disciplined manner. We used $350 million of our free cash flow to pay down debt, consistent with our deleveraging commitments. Additionally, we remain committed to returning cash to our stockholders. Our full-year dividend was $296 million, and this included an increase in the fourth quarter of 10%; and we had $350 million in share repurchases through the year, including $75 million in the fourth quarter. The accommodation of regular increases in our dividend and an increasing level of share repurchases reflect our continued confidence in future earnings and cash flows.

我們將繼續以平衡、有紀律的方式利用我們的自由現金流。我們利用 3.5 億美元的自由現金流來償還債務，這與我們的去槓桿承諾一致。此外，我們仍致力於向股東返還現金。我們的全年股息為 2.96 億美元，其中第四季度增長了 10%；全年我們回購了 3.5 億美元的股票，其中第四季度回購了 7,500 萬美元。我們定期增加股利和增加股票回購水準反映了我們對未來收益和現金流的持續信心。

And finally, our pro forma effective tax rate for the year was approximately 20%, reflecting the continued benefits of our improvement in business operations and other positive tax attributes. Tax reform also had an impact on our fourth quarter and our outlook for 2018. In the fourth quarter, the company recognized an estimated $421 million tax benefit, resulting from recent tax law changes impacting the revaluation of deferred tax liabilities, offset by expected transition tax on deferred foreign income and a reduction in the expected benefit of foreign tax credits. Our normalized effective tax rate is expected to go from 20% to 22% to 18% to 20% in 2018, reflecting the lower U.S. tax rate, partially offset by a reduction of foreign tax credits and other deductions.

最後，我們本年度的預期有效稅率約為 20%，這反映了我們業務營運改善和其他正向稅收屬性帶來的持續效益。稅制改革也對我們的第四季和2018年的前景產生了影響。第四季度，該公司確認了約 4.21 億美元的稅收收益，這是由於近期稅法變化影響了遞延所得稅負債的重估，但被遞延外國收入的預期過渡稅和預期外國稅收抵免收益的減少所抵消。我們的標準化有效稅率預計將在 2018 年從 20% 至 22% 降至 18% 至 20%，這反映了美國稅率的降低，但部分抵消了外國稅收抵免和其他扣除額的減少。

Overall a strong year for Eastman and a solid foundation from which we'll continue to grow. With that, I'll turn it back to Mark.

總體而言，對於伊士曼來說這是強勁的一年，為我們繼續發展奠定了堅實的基礎。說完這些，我就把話題轉回給馬克。

Thanks, Curt. On Slide 12, I'll discuss our 2018 outlook. We continue to benefit from the strong growth of high-value innovative products, with leading positions in attractive niche markets. We're also delivering revenue synergies through launching new products and improvements in the commercial execution capabilities of our acquired businesses. We're seeing the benefits of scale and integration, translating this attractive growth in earnings. And our continued aggressive productivity is expected to offset inflation in some of our growth spend. In addition, a modest improvement in our tax rate is expected to contribute to growth.

謝謝，Curt。在第 12 張投影片上，我將討論我們對 2018 年的展望。我們繼續受益於高價值創新產品的強勁成長，並在具有吸引力的利基市場中佔據領先地位。我們也透過推出新產品和提高所收購業務的商業執行能力來實現收入綜效。我們看到了規模和整合帶來的好處，並將其轉化為獲利的可觀成長。我們持續積極的生產力預計將抵消部分成長支出的通貨膨脹。此外，預計稅率的適度提高將促進成長。

Finally, discipline allocation of our strong free cash flow will contribute to our growth, including increasing our share repurchases in 2018 compared to 2017. To accelerate our momentum in the coming years, we are also continuing to invest in innovation and product development, and we expect higher scheduled maintenance costs in the year as we have a significant turnaround of one of our crackers in Longview, Texas that only happens every 5 years. And lastly, we expect some pressure in olefin spreads especially in the second half of the year.

最後，我們強勁的自由現金流的規範分配將有助於我們的成長，包括與 2017 年相比，2018 年我們的股票回購有所增加。為了在未來幾年加速發展，我們還將繼續投資於創新和產品開發，並且我們預計今年的定期維護成本將更高，因為我們位於德克薩斯州朗維尤的一座裂解裝置每五年才會進行一次重大檢修。最後，我們預期烯烴價差將面臨一定壓力，尤其是在今年下半年。

Putting these all together, consistent with our previous guidance, we expect adjusted EPS growth in 2018 to be between 8% and 12%. And when you consider the shape of earnings this year, you should expect the first half to be modestly stronger than the second, primarily in CI and AFP. We expect at least a 10% increase in our free cash flow, which is one of the most compelling in the industry, especially when you consider we are investing in long-term growth at the same time.

綜合以上因素，與我們先前的指引一致，我們預期 2018 年調整後的每股盈餘成長率將在 8% 至 12% 之間。當你考慮今年的獲利狀況時，你應該預期上半年的獲利將略強於下半年，主要是在 CI 和 AFP 方面。我們預計自由現金流至少會增加 10%，這是業內最引人注目的成長之一，尤其是考慮到我們同時還在投資長期成長。

Lastly this morning, a quick reminder that we will host an Innovation Day in New York on the morning of this coming Tuesday, February 6. We're incredibly excited to spend the morning with you and talking about how much progress we've made in our innovation strategy and our capabilities across the organization and how it's positioned us to continue to deliver strong attractive growth and increasing free cash flow. In particular, we'll share 3 things with you on this day. We'll talk quite extensively about our unique innovation organic growth model that I think is exceptional in this industry and has delivered one of the most robust portfolios for growth that we've ever had, and I think, outstanding for this industry. We'll also talk about how aggressive portfolio management through the years has positioned us to have growth across a range of attractive markets and structurally improved our earnings and cash flows and positioned us to deliver continued growth. And of course, we'll spend some time reviewing how we're going to be disciplined as we always have been about deploying our free cash flow for the attractive returns for our shareholders.

最後，今天早上快速提醒一下，我們將於 2 月 6 日星期二上午在紐約舉辦創新日。我們非常高興能與你們共度上午時光，討論我們在創新戰略和整個組織的能力方面取得的進展，以及它如何幫助我們繼續實現強勁的增長勢頭並增加自由現金流。具體來說，我們將在這一天與大家分享 3 件事。我們將廣泛討論我們獨特的創新有機成長模式，我認為這種模式在這個行業中是卓越的，並且提供了我們有史以來最強勁的成長組合之一，我認為，這種模式在這個行業中是傑出的。我們還將討論多年來積極的投資組合管理如何使我們在一系列有吸引力的市場中實現成長，並從結構上改善我們的收益和現金流，並使我們能夠實現持續成長。當然，我們會花一些時間審查我們如何遵守紀律，因為我們一直以來都在部署我們的自由現金流，為股東帶來豐厚的回報。

Through this discussion, we'll demonstrate how we've created value in the past and more importantly, how we're positioned to continue doing it going forward. I hope you'll be able to join us. And with that, I'll turn it back to Greg.

透過這次討論，我們將展示我們過去是如何創造價值的，更重要的是，我們如何在未來繼續創造價值。我希望你能加入我們。說完這些，我就把話題轉回給格雷格。

Thanks, Mark. We've got a lot of people on the line this morning. And we'd like to get to as many questions as possible. So I'd appreciate it if you'd limit yourself to 1 question and 1 follow up. And with that, Jennifer, we are ready for questions.

謝謝，馬克。今天早上有很多人在線上。我們希望回答盡可能多的問題。因此，如果您只問 1 個問題並進行 1 次跟進，我將非常感激。詹妮弗，我們已經準備好回答問題了。

(Operator Instructions) And we'll go first to David Begleiter with Deutsche Bank.

（操作員指示）我們首先聯繫德意志銀行的 David Begleiter。

Very strong quarter in the AFP business on a top line basis, another 14% of volume mix. How sustainable is that number in 2018?

本季 AFP 業務收入表現非常強勁，佔總營收的 14%。2018 年這個數字還能持續多久？

Thanks, David. We're incredibly proud of the team in AFP. They've just done a phenomenal job through the year of driving growth. As all you know, we had a bit of a slow start to the year and really delivered great acceleration through the year. And it was strong volume on a number of fronts. We had great growth that was delivered in the back half of the year in particular, both third and fourth quarter from our solar fills as Curt mentioned. We won a number of projects there and saw that benefit. We also had tremendous success in driving revenue synergies through the Taminco acquisition and accelerating growth in animal nutrition and care chemicals, delivering a lot of strong volume growth in tires, which is a great success story, both on the innovation efforts around tire resins and in Crystex as well as PPDs as we demonstrated how reliable we are to our customers compared to some of the competitors that we have faced out of China, who have been shut down for environmental reasons. So strong drivers across the market. I would note that coatings was more in line with how our customers grew in that mix. But as we look at 2018, we are confident we'll continue strong growth in sort of the mid-single-digits area. So it's going to moderate a bit from where we were in 2017. The key things are, this year we don't have that many solar fills so that's going to be a tough comp in the back half of the year. But we will see a return of those solar fills in 2019 and '20. It's just those orders tend to be chunky when they fall, not just within the year, but also across years. It's a great business, just chunky. In addition, we saw some growth really driven by this Chinese environmental enforcement in AFP as well as CI. And what happened there is we gained a lot of market share in some places. We expect to sustain that market share. We don't necessarily see another step up in share this year. I would note that AFP is advantaged, but it really becomes a -- demonstrating our reliability supply in that front because of how well our assets run and how we maintain them, and most of our competitors in AFP on the specialty side are small Asian players who have one line. And in this case, we've shown the value of being aligned with us. So we have a few things that are just not going to repeat. And as we mentioned, we'll have some price pressure on the pieces business as we have a competitor add some capacity and we've been talking about that for a while. So overall, very much confident delivering solid growth this year. The rate of growth will be moderate on the volume side as a result of these things.

謝謝，大衛。我們為法新社的團隊感到無比自豪。他們在推動成長的這一年裡做出了非凡的貢獻。眾所周知，我們今年的開局有點慢，但全年確實取得了很大的進步。並且在許多方面都表現出強勁的成長勢頭。正如 Curt 所提到的，我們的太陽能填充量在下半年，尤其是第三和第四季度，實現了顯著成長。我們在那裡贏得了許多項目並看到了效益。我們還透過收購 Taminco 成功推動了收入協同效應，並加速了動物營養和護理化學品的增長，輪胎銷量也大幅增長，這是一個偉大的成功案例，無論是在輪胎樹脂方面的創新，還是在 Crystex 和 PPD 方面的創新，我們都證明了與中國一些因環保原因而關閉的競爭對手相比，我們對客戶是多麼可靠。整個市場都有強大的推動力。我想指出的是，塗料更符合我們的客戶在這組合中的成長方式。但展望2018年，我們有信心繼續維持中等個位數的強勁成長。因此，與 2017 年相比，此增速將會放緩。關鍵是，今年我們沒有那麼多的太陽能填充，因此今年下半年的競爭將會很艱難。但我們將在 2019 年和 2020 年看到太陽能填充的回歸。只是這些訂單在下降時往往會很龐大，不僅是在一年內，而且在幾年內也是如此。這是一項偉大的事業，只是規模太小了。此外，我們也看到，中國環境執法確實推動了法新社和CI的一些成長。事實上，我們在某些​​地方獲得了很大的市場份額。我們希望維持這一市場份額。今年我們的份額不一定能再上升。我想指出的是，AFP 具有優勢，但它真正成為 - 展示了我們在這方面的可靠性供應，因為我們的資產運作良好以及我們如何維護它們，而我們在 AFP 專業方面的大多數競爭對手都是只有一條生產線的亞洲小型公司。在這種情況下，我們展示了與我們保持一致的價值。所以，有些事情我們不會再重複了。正如我們所提到的，由於競爭對手增加了產能，我們的零件業務將面臨一些價格壓力，而且我們已經談論這個問題已經有一段時間了。因此總體而言，我們非常有信心今年能實現穩健成長。由於這些因素，產量方面的成長率將會比較溫和。

Very good. And Curt, just on the cash flow, what's your working capital expectation for usage this year? And how much debt do you expect to pay down in 2018?

非常好。而 Curt，就現金流而言，您今年的營運資金使用預期是多少？您預計 2018 年將償還多少債務？

So if you think about cash flow, again, we're expecting greater than $1.1 billion. And better than that is a growth in -- I'd call it modest growth in working capital. If you think about our cash conversion cycle, it should be about the same. I think depending on how you calculate it, it's 98, 99 days. That will be the same cash conversion cycle in '18. Now you just to have to kind of input on your own thoughts on what you think the rising raw material environment is going to be. As it relates to the uses of cash flow, you're going to see that same disciplined capital allocation philosophy you've seen this year. So if you think about that greater than $1.1 billion, the increase in dividend is roughly going to be a $325 million use of cash. You'll probably see us continue deleveraging about the same level, maybe a little lower in -- than we did in 2017. And in absence of any bolt-on acquisitions, the rest of it will be deployed to share repurchases.

因此，如果您考慮現金流，我們預計其金額將超過 11 億美元。比這更好的是成長——我稱之為營運資本的適度成長。如果你考慮我們的現金轉換週期，它應該大致相同。我認為這取決於你如何計算，是 98 或 99 天。這與 2018 年的現金轉換週期相同。現在你只需要輸入自己的想法，看看原料環境將會如何上漲。就現金流的用途而言，您將看到與今年相同的嚴謹的資本配置概念。因此，如果您認為該金額超過 11 億美元，那麼股息的增加大約相當於 3.25 億美元的現金使用。您可能會看到我們繼續以大致相同的水平去槓桿，甚至可能比 2017 年略低。在沒有任何附加收購的情況下，剩餘資金將用於股票回購。

We'll go next to John Roberts with UBS.

接下來我們來談談瑞銀的約翰羅伯茲。

Did you have to purchase all of your acetic anhydride during the quarter? Or were you able to utilize some swaps where you have to return the volumes in the future?

您是否必須在本季購買所有的乙酸酐？或者您能夠利用一些交換，以便將來歸還這些卷？

I'm not going to get at all the different mechanics of how we secured the acetic acid, but yes, we did have to go to the marketplace and secure some.

我不會詳細講述我們如何獲得乙酸的各種機制，但是是的，我們確實必須去市場上獲取一些乙酸。

I would say that it was an impressive display of supply chain management where we are normally exporting a modest amount of acid anhydride out of this site because we consume most of what we make for our specialty products the vast majority to bringing in a phenomenal amount of acetic acid into the site. It was just extraordinary to see that flow shift in less than 30 days.

我想說，這是一次令人印象深刻的供應鏈管理展示，我們通常會從該站點出口少量的酸酐，因為我們消耗了我們為特色產品生產的大部分酸酐，而絕大多數是為了將大量的乙酸帶入該站點。在不到 30 天的時間內看到這種流量轉變真是令人驚訝。

And then it seems like your adjusted results added back the cost of the purchased acetic or acid or anhydride. Is that because when you're in normal operations running the [gas fire], the net cost of the raw material coal after the coal product intermediate credits is essentially 0. And so you'd add back the cost of any purchased raw material?

然後看起來您的調整結果又加回了購買乙酸或酸或酸酐的成本。這是因為當您在正常運作 [瓦斯火] 時，扣除煤炭產品中間信用額後的原料煤炭淨成本基本上為 0。所以您會把購買的任何原料的成本加回去嗎？

Well you got to keep them. The reason we added back the cost of the incident because first of all, we have a pretty good line of sight of what the additional costs are. And what you have typically is the cost of the incident, which is basically supported by the insurance process to go through. It actually reflects the additional cost of procuring and moving the additional raw materials into our facilities versus what it would cost for us to have produced.

那你必須保留它們。我們之所以增加該事件的成本，是因為首先，我們很清楚知道額外成本是多少。您通常需要承擔的是事故成本，這基本上是由保險流程承擔的。它實際上反映了採購和將額外原材料運送到我們的工廠的額外成本與我們生產的成本相比。

We'll go next to Aleksey Yefremov with Nomura Instinet.

接下來我們將與 Nomura Instinet 一起討論 Aleksey Yefremov。

Can you discuss the startup costs in Malaysia in 2017? And if there's any benefit from lapsing those costs in 2018?

您能討論一下 2017 年馬來西亞的啟動成本嗎？那麼，2018 年免除這些成本會有什麼好處嗎？

Well, I think if you look at maybe total costs, Mark talked about some cost headwinds. We call it investments. And so what you have there is typically between the 3 manufacturing sites that we're bringing onstream, that will come with about $30 million of this additional fixed cost that we will deal with in 2018, that we will grow into starting in 2018 and going into that 2019 period, et cetera. And just to round it out, if you think about that, plus we'll have some additional, I'd call it roughly $20 million of costs associated with some turnarounds that we didn't have in '17, and plus you got some additional growth in innovation spend, et cetera. So now, if you think about that, we are using productivities to try to maybe cut half that growth spend in half and combine that with roughly $70 million of inflation, we always have to deal with this each year, we'll have about $100 million cost reduction program. But in general, we'll have a $30 million to $40 million cost headwind related to growth investments that help or support our long-term growth going into '18.

嗯，我想如果你看看總成本，馬克談到了一些成本阻力。我們稱之為投資。因此，我們即將投入營運的 3 個生產基地通常會產生約 3000 萬美元的額外固定成本，這些成本我們將在 2018 年處理，並將從 2018 年開始增長到 2019 年期間，等等。總的來說，如果你考慮到這一點，再加上我們還將有一些額外的成本，我稱之為大約 2000 萬美元的成本，這些成本與我們在 2017 年沒有的一些轉變有關，此外，我們還獲得了一些額外的創新支出增長，等等。所以現在，如果你想想看，我們正在利用生產力來嘗試將成長支出削減一半，再加上大約 7000 萬美元的通貨膨脹，我們每年都必須處理這個問題，我們將有大約 1 億美元的成本削減計劃。但總體而言，我們將面臨與成長投資相關的 3,000 萬至 4,000 萬美元的成本阻力，這些投資有助於或支持我們進入 2018 年的長期成長。

And then as a follow up, what are your expectations for the benefit of the PDH agreement that are embedded in your guidance? And how conservative are those assumptions compared to current spot PDH margins?

然後作為後續問題，您對指導中包含的 PDH 協議的利益有何期望？與目前現貨 PDH 利潤率相比，這些假設有多保守？

So the expectations with benefits of that PDH agreement have obviously moderated with the changes in oil price in the olefins market. We still have a benefit, but it will be relatively modest.

因此，隨著烯烴市場油價的變化，PDH協議帶來的收益預期明顯減弱。我們仍然有好處，但相對較少。

We'll go next to Duffy Fischer with Barclays.

接下來我們來談談巴克萊銀行的達菲‧菲舍爾 (Duffy Fischer)。

First question, just around tow. You had gone to great lengths to kind of lock in some longer-term contracts. So the price down in the fourth quarter and some price coming down next year, did that play out like you thought? Or is that kind of an incremental negative versus what you thought when you went to those longer-term contracts?

第一個問題，只是圍繞著拖車。您已經竭盡全力鎖定一些長期合約。那麼第四季的價格下跌以及明年價格的下降，是否如您所想的那樣發展？或者，與您簽訂長期合約時所想的相比，這是否會產生負面影響？

Yes. So as we said, we secured about 2/3 of our tow volume in long-term agreements. Obviously, there was 1/3 that wasn't. And we saw some residual competitive pressure in that space. The price down you saw in the fourth quarter was just the nature of the pricing in the agreements we set for the year. But as you look at 2018, you will see some sort of more moderated reduction in price associated with some continued competitive conditions throughout the year last year. But as Curt said, those moderated price declines in comparison to last year will be more than offset by some of the cost reduction efforts we have, tow volume being the same. So in general, we feel good about sort of where it all nets out to being stable for the year. With -- I think we have a good chance to drive for some very modest growth, when you include the innovation programs. We're really excited to walk you through all of that next week and show how much progress we've made. On the innovation portfolio, I've been pushing that off with you guys for a while, just sort of get the -- get into the market and see success. And we really have delivered some tremendous success and can't wait to just share with you.

是的。正如我們所說，我們透過長期協議確保了約 2/3 的拖車量。顯然，有三分之一不是。我們看到該領域存在一些殘留的競爭壓力。您在第四季度看到的價格下跌只是我們為今年制定的協議中定價的性質。但當你展望2018年時，你會看到價格出現了某種程度的溫和下降，這與去年全年持續的競爭條件有關。但正如 Curt 所說，與去年相比，價格下降幅度有所緩和，但下降幅度將被我們採取的一些成本削減措施所抵消，因為拖車量保持不變。所以總的來說，我們對今年整體情況保持穩定感到滿意。我認為，如果加上創新計劃，我們就有很大機會實現適度成長。我們非常高興下週能帶您了解所有這些內容，並展示我們所取得的進展。關於創新組合，我已經和你們一起推動了一段時間，只是進入市場並取得成功。我們確實取得了巨大的成功，迫不及待地想與你們分享。

Great. And then just to go back to the cash flow, you seem much more confident or bullish kind of on the more than 10% growth in free cash flow, where your earnings guide or EPS guide is kind of 8% to 12%. But yet you're going to buy back some shares, so that should be a positive for EPS relative to cash flow. Working capital will be a net negative on cash flow, wouldn't be for EPS. So where is the increased bullishness coming from on the cash flow side and relative to the EPS growth?

偉大的。然後回到現金流問題，您似乎對自由現金流超過 10% 的成長更有信心或看好，而您的獲利指南或 EPS 指南則為 8% 至 12%。但你還是會回購一些股票，所以這對相對於現金流的每股盈餘來說應該是有利的。營運資本將對現金流量產生淨負影響，不會對每股盈餘產生影響。那麼，現金流方面以及相對於每股盈餘成長而言，看漲情緒的增強來自哪裡呢？

Well, first of all, it comes from our underlying businesses. I mean, underlying business generate good cash flows, and that will continue. And so, if cash flows are not always equal exactly 100% for the growth rate, but we are going to see good cash flow growth there. We are expecting some benefits of tax reform. You've heard me talk about the challenges or headwinds we expected with higher cash taxes in the U.S., and so that will help moderate that in fact as we go transition that headwind maybe more in '19 than '18. So that helps our cash flows in '18. And again, you'll see good working capital this month. The other thing I'd remind yourself is our capital expenditures are also down $100 million. So that's also a driver of that confidence in free cash flow.

嗯，首先，它來自我們的基礎業務。我的意思是，基礎業務產生良好的現金流，而且這種情況將會持續下去。因此，如果現金流的成長率並不總是恰好等於 100%，但我們會看到良好的現金流成長。我們期待稅制改革帶來一些好處。你已經聽我談論了我們預計美國提高現金稅將帶來的挑戰或阻力，因此，這將有助於緩和這種阻力，事實上，隨著我們進入過渡期，這種阻力在 2019 年可能比在 2018 年更大。這有助於我們 18 年的現金流。再次，本月您將看到良好的營運資金。我要提醒您的另一件事是我們的資本支出也下降了 1 億美元。這也是對自由現金流信心的驅動因素。

And the other thing I would note on the earnings side of this when it comes to tax is that as we looked to our guidance, we've kept the range 8% to 12%, but where we were leaving you guys last fall was we'd be at the low end of that range from what we could see. Obviously, with this tax benefit, we'll now move into the middle of the range of that 8% to 12%.

在談到稅收時，我想就收益方面指出的另一件事是，根據我們的指導，我們將稅率保持在 8% 至 12% 的範圍內，但從我們去年秋天給你們的預測來看，稅率處於該範圍的低端。顯然，有了這個稅收優惠，我們現在將進入8%到12%的中間範圍。

We'll go next to P.J. Juvekar with Citi.

接下來我們將與花旗銀行一起前往 P.J. Juvekar。

Mark, you guys did a good job in AFP and Advanced Materials in terms of volumes. But pricing has been somewhat weak, particularly in ad mat for last several quarters. And that is despite rising raw materials. So what does it take to get pricing up there? Or are you guys just not pushing price to get volumes? Can you just talk about that?

馬克，就數量而言，你們在 AFP 和 Advanced Materials 方面做得很好。但定價一直有些疲軟，尤其是過去幾季的廣告素材。儘管原物料價格上漲，但情況依然如此。那麼要怎麼樣才能提高價格呢？或者你們只是不推高價格來獲得銷量？你能簡單談談這個嗎？

Sure. So in Advanced Materials, as you noted, the prices didn't change that much. There's a lot in that mix as well that you have to keep in mind. But the first thing I'd note is compared to CI and AFP, the rate of raw material increase in Advanced Materials is actually quite modest. The PX market is pretty competitive and we didn't see that much increase in PX really compared to the other segments. What we're really focused on in Advanced Materials is driving mix upgrade. That's how we've created all this value. And when we're growing things like Tritan acoustics and head-up displays interlayers and all of the performance films business at pretty attractive high margins, that's how we drive growth and that's how we delivered earnings growth over the last 5 years in that business. On the pricing front, we did make good progress actually on pricing relative to the PX on the copolyester side of the business. But the prices were flat due to the annual contracts and interlayers so that mitigated how you're seeing the overall price movement in the segment. And of course, we had some prices come off in a few places. But I actually feel that we did a great job on that and we have some good momentum and feel good about how we're going to manage price versus raws into '18.

當然。因此，正如您所說，先進材料的價格並沒有太大變化。您還必須記住其中的許多內容。但我首先要注意的是，與 CI 和 AFP 相比，先進材料公司的原料漲幅其實相當溫和。PX 市場競爭相當激烈，與其他領域相比，我們並沒有看到 PX 有太大的成長。我們在先進材料領域真正關注的是推動混合升級。這就是我們創造所有價值的方式。當我們以相當誘人的高利潤率發展Tritan聲學和平視顯示器夾層和所有高性能薄膜業務時，這就是我們推動成長的方式，也是我們在過去5年中實現該業務盈利增長的方式。在定價方面，我們在共聚酯業務方面相對於 PX 的定價方面確實取得了良好進展。但由於年度合約和夾層，價格持平，因此減輕了您看到的該領域整體價格變動。當然，有些地方的價格有所下降。但我確實覺得我們在這方面做得很好，我們有良好的勢頭，並且對如何在 2018 年管理價格與原材料感到滿意。

Okay. And then you've talked about the Chinese competitors having issues. Can you just talk about what products that you're seeing that benefit? And generally, you can talk -- if you can talk about your China operations outside of filter tow.

好的。然後您談到中國競爭對手遇到的問題。能談談您看到哪些產品有益嗎？一般來說，您可以談談——如果您可以談論過濾拖曳之外的中國業務。

Sure. So especially in AFP and CI, we have a number of competitors who are based out of China. And in AFP, there are players that we have in products like Crystex, some of the olefin-related products, where they're typically very small private companies who started up a plant somewhere. And in this case, many of them were not in an industrial park. So when they started enforcing environmental restrictions, they had to shut down because they were in some suburb or some place that wasn't appropriate. And we really benefit from that especially in tires but also in some of the olefin-related businesses as well. And then as you think about the overall China business, it's a great business. I mean, tow has obviously got its own unique story. But we're well positioned across Advanced Materials and Additives & Functional Products in selling a number of specialties into that market across the whole spectrum from transportation to consumables, consumer durables, et cetera. So it's a robust business but a big driver of growth for us.

當然。特別是在 AFP 和 CI 領域，我們有許多來自中國的競爭對手。在 AFP，我們有一些生產 Crystex 等烯烴相關產品的企業，他們通常是在某個地方開設工廠的小型私人公司。在這種情況下，其中許多都不在工業園區。因此，當他們開始執行環境限制時，他們不得不關閉，因為他們位於某個郊區或某個不合適的地方。我們確實從中受益，特別是在輪胎領域，但也在一些烯烴相關業務中。當你考慮整個中國業務時，你會發現這是一項很棒的業務。我的意思是，這顯然有它自己獨特的故事。但我們在先進材料和添加劑及功能產品領域佔據有利地位，可以向從運輸到消耗品、耐用消費品等整個領域的市場銷售多種專業產品。因此，這是一項強勁的業務，也是我們成長的一大動力。

We'll go next to Vincent Andrews with Morgan Stanley.

接下來我們來談談摩根士丹利的 Vincent Andrews。

With the lower U.S. tax rate, I guess just a couple of questions around it. Obviously, you're trying -- you're still presumably trying to sell the Longview cracker. So any update there? Maybe that's helpful to have a lower tax rate now. But also you talked about the $25 million incremental investment. But as you think about broader capital allocation, whether it's organic or for M&A, are you more focused on U.S. now with a lower tax rate than you might have been otherwise? Or how has your calculus changed, if any?

由於美國稅率較低，我猜這方面只存在幾個問題。顯然，您正在嘗試——您大概仍在嘗試銷售 Longview 餅乾。有更新嗎？也許現在降低稅率是有幫助的。但您也談到了 2500 萬美元的增量投資。但是，當您考慮更廣泛的資本配置時，無論是有機的還是併購，您是否現在更關注美國的稅率比其他地區更低？或者你的微積分發生了怎樣的變化（如果有的話）？

All right. Well, first, you asked a question about the status of the ethylene sale and we'll start there and then we'll talk about tax rate and then how we might think about investment. So first of all, on the sale process, divesting the excess ethylene position and the potential commodity ethylene derivatives, it remains a priority for us. You've heard that before, but nothing has changed there. While excess ethylene is a source of volatility and that's strategic to our future growth, the underlying assets are high-quality that generate significant value. So we're just going to continue with our process. It's an active process, with multiple parties seriously engaged with us. And so we're working hard to see if we can get a transaction completed. On the tax rate, just to clarify again, we are expecting a modest impact in part on the effect of tax rate. In addition, as we transition, it minimizes some of the headwinds we have on tax as we go into '18 by facing more in '19. But then on a cash basis, between all the things, this probably is a $50 million cash benefit for us relative to some of those headwinds we're starting to face. So that allows us to have a little extra cash to put to work. So as we reflected on the benefits for us, like most companies in the U.S. are doing, we wanted to make sure that we stayed true to our strategy. So if we think about how we invest some of this tailwind -- and by the way, overall tax reform I think for this country for Eastman is fantastic to improve our competitiveness in the world. We wanted to really reinvest in our strategy. So we're going to increase our resourcing in the R&D side and the growth resources on the commercial side to accelerate these innovation programs that we have moving in place. We also saw the opportunity to take some of the cash and reinvest it into bottlenecking some of our plants, improving yields and quality on some of our plants to support us better in the strong growth we're having. So that's how we decided to do it. We think that's the best way to improve the quality of our employees' sort of job security and career tracks. And we also think it's a great way to create some attractive jobs in this country. The chemicals sector is a great place to work. Our salaries are well above the industrial average and significantly above the service sector with the mix upgrade, just like in our strategy, if you think about America and what we're doing. So we think tax is great. One other thing I'd note is the biggest upside to tax reform I think for all of us is stimulating economic growth in this country and by association around the world. And if that growth stimulus happens, that would be upside to our forecast.

好的。嗯，首先，您問了一個關於乙烯銷售狀況的問題，我們將從那裡開始，然後討論稅率，然後討論我們如何考慮投資。因此，首先，在銷售過程中，剝離過剩的乙烯部位和潛在的商品乙烯衍生物仍然是我們的首要任務。您以前聽說過，但事實並非如此。雖然過剩的乙烯是波動的來源，並且對我們的未來成長具有戰略意義，但基礎資產是高品質的，可以產生巨大的價值。因此我們將繼續我們的進程。這是一個正面的過程，有多方與我們認真參與。因此我們正在努力看看是否能夠完成交易。關於稅率，需要再次澄清的是，我們預期稅率的影響將在一定程度上受到溫和的影響。此外，隨著我們的轉型，我們將在2019年面臨更多的稅收阻力，從而將2018年面臨的稅收阻力降至最低。但從現金角度來看，相對於我們開始面臨的一些不利因素，這對我們來說可能意味著 5,000 萬美元的現金收益。這樣我們就有一點額外的現金可以投入使用。因此，當我們反思我們所獲得的利益時，就像美國大多數公司所做的那樣，我們希望確保我們堅持自己的策略。因此，如果我們考慮如何投資這些順風——順便說一句，我認為整體稅收改革對這個國家和伊士曼來說非常有利於提高我們在世界上的競爭力。我們真正想對我們的策略進行再投資。因此，我們將增加研發方面的資源和商業方面的成長資源，以加速我們正在實施的創新計劃。我們也看到了利用部分現金進行再投資的機會，用於解決部分工廠的瓶頸問題，提高部分工廠的產量和質量，以更好地支持我們實現強勁增長。所以我們就決定這麼做。我們認為這是提高員工工作保障和職涯發展軌跡的最佳方式。我們也認為這是在這個國家創造一些有吸引力的就業機會的好方法。化學品行業是一個很好的工作場所。如果你考慮美國和我們正在做的事情，你會發現我們的薪資遠高於產業平均水平，而且隨著組合升級，我們的薪資也顯著高於服務業，就像我們的策略一樣。所以我們認為稅收很棒。我還想指出的一件事是，我認為稅制改革對我們所有人來說最大的好處是刺激這個國家以及全世界的經濟成長。如果這種成長刺激措施得以實施，那麼我們的預測將會出現上行。

Okay. And just as a follow-up, can you give us a sense of the FX impact that you're expecting for 2018 at current rates?

好的。作為後續問題，您能否告訴我們，按照目前的匯率，您預計 2018 年的外匯影響會如何？

Well, we have assumed then, the outlook right now is -- the biggest thing is euro to dollar relationship. We've assumed a little -- about a $1.20 maybe a little stronger, and that's built into our outlook statement. I know it's trading a little higher than that, but let's see if that stays there for a period of time before we talk any further upside to our forecast. But if it does, it will have an impact on our outlook. But right now, we're assuming $1.20 or so.

那麼，我們已經假設，目前的前景是──最重要的是歐元與美元的關係。我們做出了一點假設——大約 1.20 美元，可能稍微強一點，這已經納入我們的展望聲明中。我知道它的交易價格比這個高一點，但讓我們看看它是否會在那裡保持一段時間，然後再討論我們的預測是否還有進一步的上漲。但如果確實如此，它將對我們的前景產生影響。但目前，我們假設價格在 1.20 美元左右。

We'll go next to Kevin McCarthy with Vertical Research Partners.

接下來我們來談談 Vertical Research Partners 的 Kevin McCarthy。

Mark, in your prepared remarks, I think you indicated that you'd anticipate greater share repurchases in 2018 versus '17. Can you put that into context for us versus the $350 million that you did? It looks like, for example, you delevered by $0.25 billion in the fourth quarter. Are you happy with the balance sheet, where it is now? And should we anticipate a meaningful shift in that regard looking ahead?

馬克，在你準備好的發言中，我認為你表示你預計 2018 年的股票回購規模將比 2017 年更大。您能否與我們比較一下您所投入的 3.5 億美元？例如，看起來你們在第四季去槓桿了 2.5 億美元。您對目前的資產負債表滿意嗎？我們是否應該期待未來這方面會發生有意義的轉變？

This is Curt. First of all, we love our balance sheet. There's still some additional deleveraging we need to do, consistent with our commitment to maintain a solid investment credit rating. So the deleveraging that we're going to do is going, again, be similar to a little less than what we did in '17. And that will continue to improve our metrics especially as we've also been growing our EBITDA. As it relates to the capital allocation, again, you should always assume our free cash flow is fully deployed. I know that's still -- I don't think it's fully appreciated in the industry yet that we will fully deploy our capital or our cash flow. So yes, in absence for bolt-on acquisitions, we will see an increase in share repurchases. I'd still like to see an execution of that kind of spread throughout the year. We tend not to do accelerated programs, but we'll see how the year progresses and whether we change that strategy. But that's how we currently think about it.

這是 Curt。首先，我們喜歡我們的資產負債表。我們還需要進行一些額外的去槓桿化，以符合我們維持穩健投資信用評等的承諾。因此，我們將要進行的去槓桿措施將與 2017 年的措施類似，但幅度會略小。這將繼續改善我們的指標，特別是因為我們的 EBITDA 也在不斷成長。由於它與資本配置有關，因此，您應該始終假設我們的自由現金流已充分利用。我知道這仍然是——我認為業界還沒有完全認識到我們將充分利用我們的資本或現金流。所以是的，在沒有附加收購的情況下，我們將看到股票回購的增加。我仍然希望看到這種傳播方式在全年實施。我們傾向於不做加速計劃，但我們會觀察今年的進展情況以及我們是否會改變這個策略。但這就是我們目前的想法。

And then as a follow-up, sticking with the same subject, how would you characterize your M&A pipeline activities been relatively quiet it seems to me over the last year or so? Do you see interesting bolt-ons or anything larger of interest looking ahead?

然後作為後續問題，繼續討論同一主題，您如何描述過去一年左右的併購通路活動相對平靜的情況？您是否看到了有趣的附加功能或任何更大的有趣的東西？

So first, we -- you're right. We have been very focused on demonstrating we can deliver organic growth, not just from heritage Eastman but also from our acquired businesses. Next week, you'll see tremendous innovation and growth stories across our portfolio, and it's amazing how much we've accelerated growth and what we've acquired, not just what we have. So that's been our focus. And I think it's important to drive confidence for all of our shareholders so we can get a good return on our investments both capital and acquisitions. As we look forward, we are aiming for doing bolt-on acquisitions that reinforce and strengthen some of the positions we have in our specialty businesses. And so we'll look to try and make that happen as a balanced approach and capital allocation. I'll tell you right now, we don't have anything active. But it is something that we hope to do as we move forward from this point forward.

首先，我們——你是對的。我們一直非常注重證明我們能夠實現有機成長，不僅來自傳統的伊士曼，也來自我們收購的業務。下週，您將看到我們投資組合中巨大的創新和成長故事，令人驚嘆的是，我們的成長速度如此之快，而且我們所獲得的不僅僅是我們所擁有的。這就是我們的重點。我認為增強所有股東的信心非常重要，這樣我們才能從資本和收購的投資中獲得良好的回報。展望未來，我們的目標是進行附加收購，以鞏固和加強我們在專業業務中的一些地位。因此，我們將嘗試透過平衡的方法和資本配置來實現這一目標。我現在就告訴你，我們沒有任何活動。但這是我們從現在開始向前邁進時希望做的事情。

We'll go next to Jeff Zekauskas with JPMorgan.

接下來我們來談談摩根大通的 Jeff Zekauskas。

What was your cash tax rate in '17? What do you expect it to be in '18? And what do you forecast for '19?

2017 年您的現金稅率是多少？您預計 2018 年的情況會如何？您對 2019 年有何預測？

Well, you see in the cash flow statement and you can see what the impact is on deferred taxes. So I think our cash tax rate actually increased slightly in 2017. Both of the ways I try to characterize kind of that headwind of taxes is we've been benefited from the NOLs we acquired from Solutia, so that was about $1.5 billion of NOLs. And we really enjoyed the benefit of those kind of over the 5 years tax effect that you can get a rough sense of how much we've benefited. And then as that benefit of NOLs rolled off, we were starting to use the foreign tax credits. Now as we transition to a territorial tax system, we've now lost some of the benefit of those foreign tax credits. '18 is still a transition year, so we'll see how much we can manage through this. But you will see our cash tax rates to grow modestly in '18 and a little bit more in '19. But Jeff, bottom line, we don't quantify the exact cash tax rate. But you can see how it's reflected in our free cash flow goals overall.

好吧，您可以在現金流量表中看到對遞延稅項的影響。所以我認為我們的現金稅率在 2017 年實際上略有增加。我嘗試用​​兩種方式來描述這種稅收逆風，我們從 Solutia 收購的 NOL 中受益，所以那是大約 15 億美元的 NOL。我們確實享受了這種五年稅收效應的好處，你可以大致了解我們受益多少。然後，隨著淨營業收入 (NOL) 的益處逐漸顯現，我們開始使用外國稅收抵免。現在，隨著我們向屬地稅制過渡，我們失去了一些外國稅收抵免的優惠。2018 年仍是一個過渡年，所以我們將看看我們能度過多少難關。但你會看到我們的現金稅率在2018年會小幅成長，在2019年會略有成長。但傑夫，歸根究底，我們並沒有量化確切的現金稅率。但你可以看到它是如何反映在我們的整體自由現金流目標中的。

Okay. So what you said is your cash tax rate will rise in '18 and then rise a little bit in '19?

好的。所以您說的是，現金稅率將在 2018 年上升，然後在 2019 年略有上升？

Yes, it will rise a little bit in '18 and it will probably rise a little bit more in '19. Overall, though, we're confident our free cash flow as a company increasing this year and continue to increase as we move forward.

是的，18 年會略有上漲，19 年可能還會進一步上漲。總體而言，我們相信，我們公司的自由現金流今年將會增加，並且會隨著我們的發展而持續增加。

We'll go next to Bob Koort with Goldman Sachs.

接下來我們來談談高盛的鮑伯‧庫爾特 (Bob Koort)。

You mentioned and Curt as well that at the Innovation Day, you're going to give us some direction on the things you've been working on and the value it creates. And just curious, as you look forward in A & FP and AM, should we expect to see that manifest as margin lift or primarily volume lift? And then secondly, is it good or bad for Eastman Chemical if there's broad inflation in your feedstock base?

您和 Curt 也提到，在創新日，您將為我們介紹您一直在做的事情及其創造的價值的一些指導。只是好奇，當您展望 A & FP 和 AM 時，我們是否應該期望看到它表現為利潤率提升或主要是銷售提升？其次，如果伊士曼化工的原料基礎出現普遍通貨膨脹，這對伊士曼化工來說是好是壞？

So on the first question, Bob, we'll extensively cover that topic about how innovations can drive growth through the company across AM, AFP as well as starting to help Fibers in the portfolio. So that will be our focus. It is a volume-driven story more than it is a margin-driven story. We get a great mix uplift that moves our margin up within the segments, especially Advanced Materials. But when you think about AFP and AM, the margin there are much more attractive than CI. So as we're driving growth there and intentionally not growing CI at the same rate because they're sending intermediates down to the growing specialties, that's a huge mix upgrade within the portfolio. So you do get margins improving over time, but the real story is volume and mix upgrade in the specialties. So that's sort of where you get on that front. On the oil question, what we'd say is steadily -- a steady oil environment and an increasing oil environment is favorable to Eastman. A volatile oil environment is not in general over the long term because when it's spiking up and down, it's just always hard to manage the pricing. As we look at the current situation in 2018, what I'd say is on the methanol side, so for amines and acetyls, we see a nice tailwind coming, with oil and associated methanol going up. When you think about the olefin side, in the short term, there is a supply demand dynamic issue that goes on top of oil, where you have all these crackers and PDH units coming up. So we're expecting some short-term pressures over the long term. We feel good about how those spreads evolve.

因此，關於第一個問題，鮑勃，我們將廣泛討論該主題，即創新如何推動公司在 AM、AFP 領域的成長，以及如何開始幫助產品組合中的 Fibers。所以這將是我們的重點。這是一個由數量驅動的故事，而不是由利潤驅動的故事。我們獲得了巨大的組合提升，從而提高了各個細分市場（尤其是先進材料）的利潤率。但是當您考慮 AFP 和 AM 時，那裡的利潤比 CI 更有吸引力。因此，當我們在那裡推動成長時，故意不以相同的速度成長 CI，因為他們將中間體發送到不斷增長的專業領域，這是產品組合中的巨大組合升級。因此，隨著時間的推移，利潤率確實會提高，但真正的問題是專業領域的產量和組合升級。這就是你在這方面所取得的進展。關於石油問題，我們的觀點是，穩定的石油環境和不斷增長的石油環境對伊士曼有利。從長期來看，石油價格通常不會波動，因為當價格大幅波動時，價格總是難以控制。當我們回顧 2018 年的當前情況時，我想說的是甲醇方面，因此對於胺和乙醯基而言，我們看到了良好的順風，石油和相關甲醇的價格將會上漲。當你考慮烯烴方面時，在短期內，除了石油之外，還有供需動態問題，因為所有這些裂解裝置和 PDH 裝置都正在上線。因此，我們預期長期來看會出現一些短期壓力。我們對這些利差的演變感到滿意。

We'll go next to Frank Mitsch with Wells Fargo.

接下來我們來談談富國銀行的弗蘭克‧米奇 (Frank Mitsch)。

Congrats on getting the coal gas unit up before year-end. Curt, I wanted to follow up on Slide 12, the near-term headwinds. I took down a bunch of numbers. I just want to make sure I got this correct and also wanted to learn more about the cost reduction program you referenced. So the cost of strategic growth investments, I believe you said was $30 million to $40 million headwind '18 versus '17, was that correct?

恭喜瓦斯裝置在年底前投入運作。科特，我想跟進幻燈片 12 中的近期不利因素。我記下了一些數字。我只是想確保我理解的正確，也想了解更多有關您提到的成本削減計劃的資訊。所以，我相信您說的策略性成長投資成本是 2018 年與 2017 年相比 3,000 萬至 4,000 萬美元，對嗎？

Yes. Again, that's mainly the impact of the cost of bringing these new production facilities online. A good portion of that just the higher depreciation in that -- depreciation that comes with bringing assets online.

是的。再一次，這主要是這些新生產設施上線成本的影響。其中很大一部分只是更高的折舊——資產上線後產生的折舊。

All right, great. And then also, the higher scheduled maintenance costs, I think you referenced $20 million year-over-year net increase, is that correct?

好的，太好了。然後，對於更高的定期維護成本，我記得您提到了同比淨增加 2000 萬美元，對嗎？

That's correct. It's primarily related to a cracker turnaround in the second quarter.

沒錯。這主要與第二季的餅乾產量改善有關。

In Q2? That's all in Q2?

在第二季？Q2 就這些嗎？

Yes, that cracker turnaround is in Q2.

是的，餅乾產業的改善發生在第二季。

Terrific. And then I believe you said that there was a -- and then you also said you have general inflation, labor costs, et cetera, $70 million. And a lot of this should be offset by $100 million cost reduction program. Can you go into any more details on that program?

了不起。然後我相信您說過——然後您還說過一般通貨膨脹、勞動力成本等等，7000 萬美元。其中很大一部分應該透過 1 億美元的成本削減計劃來抵消。能詳細介紹一下該計劃嗎？

Well, again, we have a great team of people at Eastman, who know how to manage cost. It's in our DNA. And so this is a group of people who have been working on offsetting inflation every year. And we asked them to deliver more than that periodically. Like we've done in the past, we asked them to deliver more than inflation in 2017. What we're asking for that team to do is help to offset some of this growth investment as we grow into it to help those kind of have good earnings growth in '18. And as those growth investments take off and we get the benefits of it, we'll continue to offset inflation through the productivity programs.

嗯，再說一次，伊士曼擁有一支優秀的團隊，他們知道如何管理成本。它存在於我們的 DNA 中。這是一群每年都在致力於抵消通貨膨脹的人。我們也要求他們定期提供更多服務。就像我們過去所做的那樣，我們要求他們在 2017 年實現更高的通膨目標。我們要求團隊做的是，隨著我們不斷成長，幫助抵消部分成長投資，以幫助這些公司在 2018 年實現良好的獲利成長。隨著這些成長投資的啟動以及我們從中獲益，我們將繼續透過生產力計劃來抵消通貨膨脹。

Yes, Frank, just to sort of summarize that up. First of all, the productivity programs -- and we do this every year, so this is standard to what we do. A lot of it is manufacturing, improving yields, quality, debottlenecking, stretching plants. But it's just great productivity. It's not that people-related this year. When you think about that and all the costs that Curt has laid out from the growth investments and the higher maintenance costs, the point we're trying to say is net, we'll offset inflation of $70 million, and of this growth spend and maintenance cost, we'll offset a portion of that but not all of it. So net-net, you've got a fixed cost headwind in the $30 million to $40 million range, all in, in -- from '17 to '18.

是的，弗蘭克，我來總結一下。首先，生產力計劃——我們每年都會這樣做，所以這是我們工作的標準。其中很多是製造業，提高產量、品質、消除瓶頸、延長工廠壽命。但這只是極高的生產力。今年與人的關係則不那麼密切。當你考慮到這一點以及 Curt 從成長投資和更高的維護成本中列出的所有成本時，我們想說的是淨值，我們將抵消 7000 萬美元的通貨膨脹，並且對於這筆增長支出和維護成本，我們將抵消其中的一部分，但不是全部。因此，從 2017 年到 2018 年，你的固定成本阻力在 3,000 萬美元到 4,000 萬美元之間。

We'll go next to Michael Sison with KeyBanc Capital Markets.

接下來我們來談談 KeyBanc Capital Markets 的 Michael Sison。

In terms of EPS growth for '17, how much of that do you think was driven by your specialty businesses? And I guess by your outlook for the segments in '18, did the specialty businesses support more of that EPS growth as we head into next year?

就 2017 年每股盈餘成長而言，您認為其中有多少是由您的專業業務推動的？我想，根據您對 2018 年各細分市場的展望，特種業務是否會在明年支持更多的每股盈餘成長？

Yes. So if you think about it, the way I think about it is the specialty businesses were the key driver for earnings growth last year and they're going to be the key driver for earnings growth this year. It's a little bit different story in how you do that. In '17, you had a recovery in CI especially the heads rolling off basically offsetting the headwind we had in Fibers. So CI and Fibers sort of neutralized each other out and we delivered growth in the specialties as well as leveraging other elements of our income statement from interest cost to tax rate and share count. As you look at this year, it's sort of the same story. We're going to have strong growth in the specialty businesses as we've guided. Fibers, actually will be stable to '17, CI will be stable to '17. And so same story about where the net earnings growth comes from. And of course, were going to keep levering the other elements of the income statement, too, so better interest cost, better tax, better share reduction than last year. So it all comes together in developing a pretty good compelling story, and equally important, increasing free cash flow to a very attractive level.

是的。所以如果你仔細想想，我的想法是，專業業務是去年獲利成長的主要驅動力，它們也將成為今年獲利成長的主要驅動力。至於如何做到這一點，那就有點不同了。2017 年，CI 業務出現復甦，尤其是頭部業務的下滑，基本上抵消了我們在 Fibers 業務中遇到的逆風。因此，CI 和 Fibers 在某種程度上相互抵消，我們在專業領域實現了成長，同時利用了損益表中的其他要素，從利息成本到稅率和股票數量。回顧今年，情況大致相同。正如我們所預期的，我們的專業業務將實現強勁成長。纖維實際上將穩定到 '17，CI 將穩定到 '17。關於淨收益成長的來源也是同樣的道理。當然，我們也將繼續利用損益表的其他要素，以實現比去年更好的利息成本、更好的稅收、更好的股份減少。因此，所有這一切都匯聚在一起，形成了一個相當引人入勝的故事，同樣重要的是，將自由現金流提高到一個非常有吸引力的水平。

Great. And then if you think about your bolt-on acquisitions, you've done a nice job adding specialty businesses over the last several years. Are there certain areas within the product lines that you'd like to reinforce or opportunities to maybe get bigger in certain of the specialty businesses?

偉大的。然後，如果您考慮您的附加收購，您會發現過去幾年您在增加專業業務方面做得很好。您是否希望加強產品線中的某些領域，或希望在某些專業業務中擴大規模？

We're not going to get into specific target areas until we've actually delivered the acquisitions, Mike. But there are definitely attractive parts of Advanced Materials where we can see value in doing some bolt-on M&A. We've got a great track record already on Advanced Materials and some bolt-on M&A in the performance films business. And there are a few other places beyond that as well that we can look at. In Additives & Functional Products, the combination of Taminco with Eastman's capabilities, creates some opportunities for looking for some bolt-on acquisitions to improve our growth rate. And so it's a target-rich area in that space as well. So we have a bunch of ideas and things we're considering and looking forward to using that as another lever. But right now, we're focused on delivering organic growth, focused on managing costs, focused on delivering free cash flow and returning to shareholders. And as we get those done, we'll do it. I'd also note we have a great track record of being exceptionally disciplined in what we pay for our acquisitions. And that's also why we've been a little bit slow because we want to make sure we don't overpay.

麥克，在我們實際完成收購之前，我們不會進入特定的目標領域。但先進材料確實有一些吸引人的部分，我們可以看到進行一些附加併購的價值。我們在先進材料領域已經擁有出色的業績記錄，並且在高性能薄膜業務方面進行了一些附加的併購。除此之外，還有一些其他地方值得我們關注。在添加劑和功能產品領域，Taminco 與 Eastman 的能力相結合，為尋求一些附加收購以提高我們的成長率創造了一些機會。因此，它也是該領域中目標豐富的區域。因此，我們有很多想法和事情正在考慮，並期待將其作為另一個槓桿。但現在，我們專注於實現有機成長、專注於管理成本、專注於實現自由現金流和回報股東。一旦我們完成了這些，我們就會去做。我還要指出的是，我們在收購支付方面有著極其嚴格的紀律，有著良好的記錄。這也是為什麼我們進展緩慢的原因，因為我們想確保不會支付過高的費用。

We'll go next to Arun Viswanathan with RBC Capital Markets.

接下來我們來談談加拿大皇家銀行資本市場的阿倫‧維斯瓦納坦 (Arun Viswanathan)。

Just wanted to confirm the cadence for EPS. Did you say that Q4 would be similar to Q1? Or was that a Fibers-only comment? And then similarly, for first half, that would be greater than second half. Maybe just remind us what the cadence was on EPS?

只是想確認 EPS 的節奏。您是否說過 Q4 會與 Q1 相似？或者這只是針對 Fibers 的評論？類似地，對於上半部來說，這將大於下半部。也許只是提醒我們 EPS 的節奏是什麼？

Yes, so what we said is that the first half is going to be modestly stronger than the second half of the year at the corporate level for EPS. And in particular, what we see is -- we see actually quite a good, strong start to the year as we're going right now. So we feel good about the first quarter across the portfolio. But as you look at the back half of the year, you get some sort of one-off headwinds in AFP like the solar fills not repeating this year compared to the back half of last year and some of this pressure in adhesives as well as the olefin pressure that we expect in the back half of the year. So that's sort of what moderates the back half a little bit relative to the first half.

是的，所以我們說，從企業層級來看，上半年的每股盈餘將略高於下半年。特別是，我們看到的是——就目前的情況來看，今年的開局確實相當不錯，而且勢頭強勁。因此，我們對整個投資組合第一季的表現感到滿意。但當你看向今年下半年時，你會發現 AFP 出現了一些一次性的逆風，例如與去年下半年相比，今年的太陽能填充物沒有重複出現，而且我們預計下半年黏合劑和烯烴的壓力也會增加。因此，相對於前半部分，後半部分會稍微緩和一些。

And just as a follow-up, just curious on China. I mean, you've alluded to a lot of capacity having to move to parks or being shut down. Is there any estimate on how much of their industry that is relative to what it was in the past? Or how has it improved the supply/demand environment over there?

作為後續問題，我對中國的情況感到好奇。我的意思是，您提到很多容量必須轉移到公園或被關閉。有沒有估計他們的行業相對於過去的水平有多少變化？或者它如何改善了那裡的供需環境？

Yes, the China effect, there's a lot of people talking about it. But it's encouraging to see the Chinese enforce their environmental laws and clean up their impact on the global environment, and we appreciate and applaud their efforts. The impact is shutting down a bunch of particularly private companies that are typically small, typically trying to get into the specialty side of the equation because they are located in the right location. And so most of those guys are under pressure if they're not operating appropriately. Some may be able to get financing to move to a new chemical park. And if they do and do start up, they're going to have higher operational costs in those locations than where they were in the past. So either way we look at it, if they don't come back, obviously that's helpful. If they do come back, they're going to have a higher cost structure. We do expect some to come back. But it's unclear because the China government is also trying to improve their control on financing and cleaning up bad debt. So it's not clear exactly how many people will get financing to sort of come back.

是的，很多人都在談論中國效應。但看到中國嚴格執行環境法並消除對全球環境的影響是令人鼓舞的，我們讚賞並讚揚他們的努力。其影響是關閉一批特別私人的公司，這些公司通常規模較小，通常試圖進入專業領域，因為它們位於正確的位置。因此，如果這些人操作不當，大多數人都會面臨壓力。有些企業或許能夠獲得融資，遷往新的化工園區。如果他們確實這麼做並啟動，那麼他們在這些地方的營運成本將比過去更高。所以無論我們如何看待它，如果他們不回來，這顯然是有幫助的。如果他們真的回來，他們的成本結構將會更高。我們確實希望有些人能夠回來。但目前還不清楚，因為中國政府也在試圖加強對融資和清理壞帳的控制。因此，目前尚不清楚有多少人能夠獲得融資並重返工作崗位。

Let's make the next question the last question please.

請將下一個問題作為最後一個問題。

We'll go next to Laurence Alexander with Jefferies.

接下來我們將與傑富瑞一起採訪勞倫斯‧亞歷山大 (Laurence Alexander)。

It's Dan Rizzo on for Laurence. So you indicated that the solar fills will kind of have a tough comp and order patterns will be falling off a bit in 2018. I was wondering if solars have kind of an upside. Did they really hit margins -- they really help margins? Or is it just something that you kind of -- will work through?

丹·里佐 (Dan Rizzo) 代替勞倫斯 (Laurence)。所以您指出，2018 年太陽能填充物將面臨嚴峻的競爭，訂單模式將有所下降。我想知道太陽能是否有某種優勢。他們真的達到利潤率了嗎——他們真的有助於提高利潤率嗎？還是這只是你需要努力解決的事情？

So on the solar fills side, it's not a margin story, it's just a volume story. So we had exceptional amount of volume on solar in the back half of last year. Just think of the margins sort of similar to the segment average, so it's not a margin story.

因此，從太陽能填充方面來看，這不是利潤問題，而只是數量問題。因此，去年下半年我們的太陽能交易量非常大。只要想想利潤率與細分市場平均值的相似程度，那麼它就不是一個利潤率的故事。

And if I could add, what we mentioned earlier that the capabilities in our team that manages that business is a great example of the type of capabilities we're building at Eastman that you're going to hear a lot more about on Tuesday.

補充一下，我們之前提到的管理該業務的團隊的能力就是我們在伊士曼正在建立的能力類型的一個很好的例子，您將在周二聽到更多關於此內容的資訊。

Okay. And then forgive me if you already mentioned this, but did you talk about potentially repatriating cash just with the changes in the tax code? And what that...

好的。如果您已經提到了這一點，請原諒我，但是您是否談到了僅通過稅法變化就可能將現金匯回國內？那又怎樣…

So when you're looking about the repatriation, that's really not a material issue for us. We've always been able to move our cash really. So the impact of the repatriation is really on the mandatory piece, that 8% piece, that was assumed in our calculation. So it's really not a cash issue for us other than we're having to pay that transitional tax as we migrate to the new territorial tax system.

因此，當你考慮遣返時，這對我們來說實際上不是一個實質問題。我們確實一直能夠轉移現金。因此，匯回的影響實際上是對強制性部分的影響，即我們在計算中假設的 8% 部分。因此，除了我們在遷移到新的屬地稅制時必須繳納過渡稅之外，這對我們來說實際上不是一個現金問題。

So in summary, I just want to say that we're incredibly proud of our teams working hard everywhere to drive volume, manage cost and deliver an outstanding year of 13% EPS growth and tremendous free cash flow in '17, demonstrating our ability to grow both of our specialty businesses, which is now becoming above 70% of our total earnings. And we're really excited about Innovation Day next week, where we're going to walk through how we're going to keep driving that, keep improving these businesses, stabilize and improve Fibers. And the growth model allows us to sustain this year-over-year. So look forward to seeing you guys on Tuesday morning. Thank you.

總而言之，我只想說，我們為我們的團隊感到無比自豪，他們在各處努力工作，推動銷量，管理成本，並在 2017 年實現了 13% 的每股收益增長和巨大的自由現金流，展示了我們發展兩項專業業務的能力，目前這兩項業務已占我們總收益的 70% 以上。我們對下週的創新日感到非常興奮，我們將在那裡討論如何繼續推動創新，不斷改善這些業務，穩定和改進 Fibers。這種成長模式使我們能夠保持逐年的成長。期待週二早上見到你們。謝謝。

Thanks for joining us again this morning. Go ahead, Jennifer, sorry.

感謝您今天早上再次加入我們。繼續吧，詹妮弗，對不起。

This does conclude today's conference. We thank you for your participation.

今天的會議到此結束。我們感謝您的參與。