streamline innovate grow...2020/02/25 · 2) source: icis top 100 chemical distributors nimble and...
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1
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Streamline
Innovate
Grow
INVESTOR PRESENTATION
February 25 2020
2
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
This presentation includes certain statements relating to future events and our intentions beliefs expectations and predictions for the future which are ldquoforward-looking statementsrdquo within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 as amended Forward-looking statements are subject to known and unknown risks and uncertainties many of which may be beyond our control These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the expectations and assumptions A detailed discussion of these factors and uncertainties is contained in the companys filings with the Securities and Exchange Commission Potential factors that could affect such forward-looking statements include among others fluctuations in general economic conditions particularly in industrial production and the demands of our customers significant changes in the business strategies of producers or in the operations of our customers increased competitive pressures including as a result of competitor consolidation significant changes in the pricing demand and availability of chemicals our indebtedness the restrictions imposed by our debt instruments and our ability to obtain additional financing the broad spectrum of laws and regulations that we are subject to including extensive environmental health and safety laws and regulations an inability to integrate the business and systems of companies we acquire including of Nexeo Solutions Inc or to realize the anticipated benefits of such acquisitions potential business disruptions and security breaches including cybersecurity incidents an inability to generate sufficient working capital increases in transportation and fuel costs and changes in our relationship with third party providers accidents safety failures environmental damage product quality and liability issues and recalls major or systemic delivery failures involving our distribution network or the products we carry operational risks for which we may not be adequately insured ongoing litigation and other legal and regulatory risks challenges associated with international operations exposure to interest rate and currency fluctuations potential impairment of goodwill liabilities associated with acquisitions ventures and strategic investments negative developments affecting our pension plans and multi-employer pensions labor disruptions associated with the unionized portion of our workforce loss of key personnel and the other factors described in the Companys filings with the Securities and Exchange Commission We caution you that the forward-looking information presented in this presentation is not a guarantee of future events or results and that actual events or results may differ materially from those made in or suggested by the forward-looking information contained in this presentation In addition forward-looking statements generally can be identified by the use of forward-looking terminology such as ldquomayrdquo ldquoplanrdquo ldquoseek ldquowillrdquo ldquoexpectrdquo ldquointendrdquo ldquoestimaterdquo ldquoanticipaterdquo ldquobelieverdquo or ldquocontinuerdquo or the negative thereof or variations thereon or similar terminology Any forward-looking information presented herein is made only as of the date of this presentation and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions the occurrence of unanticipated events or otherwise
This presentation includes certain non-GAAP financial measures intended to supplement not substitute for comparable GAAP measures Furthermore the non-GAAP financial measures presented herein may not be consistent with similar measures provided by other companies Reconciliations of non-GAAP financial measures to GAAP financial measures are provided in the Appendix at the end of the presentation Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those measures provided in the Appendix This data should be read in conjunction with Univar Solutions periodic reports previously filed with the SEC
Non-GAAP Measures
Forward-Looking Statements
3
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
About Univar Solutions
We are a leading global chemical and ingredient distributor and provider of specialty servicesPurchase chemicals and ingredients from thousands of producers and warehouse repackage blend dilute transport and sell worldwide
1) As of December 31 2019-amounts do not include Nexeo Plastics2) Source ICIS Top 100 Chemical Distributors
Nimble and resilient regardless of market conditions
Diverse Customer BaseTop 10 customers represent ~10 of sales
Asset Light Model 10-year average capexsales of 12
Diverse End MarketsNo end market represents more than ~20 of sales
CANADA 13
US 63
EMEA 19
LATAM 5
Net Sales by Region(1)
1 market position in
the US (2)
3 market position in
EMEA(2)
1 market position in
Canada(2)
Diverse Supplier BaseTop 20 premier suppliers(2) represent ~47 of
chemical purchases
4
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
LATAM9 Solutions Centers
EMEA12 Solution Centers
CANADA7 Solution Centers
USA17 Solution Centers
APAC3 Solution Centers
Customer Application and Formulation Development Expertise
Solution Centers Verticals
Lab-based Technical Employees
Field-based Technical
Employees
Total Technical Employees
56 80 136
ENERBPC CASEFOODHIC LMWF PHAR AGSOLV ALL
48 Global Solution Centers Opportunity to differentiate through real technical
leadershipbull Specialized Expertisebull Innovative Capabilitiesbull 247 Servicebull Formulating Prototypingbull Blending Testing amp Analysis
5
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Corporate History A 95 year old ldquoNewrdquo Company
1924 Founded as a brokerage business
April 2015 Acquired Key Chemical Inc one of the largest distributors of fluoride to municipalities in the US expanding our offerings into the municipal and other industrial markets
June 2015 Oversubscribed IPO and concurrent private placement resulted in approximately $760 million net proceedsused to pay the remaining principal balance of Senior Subordinated Notes began trading on NYSE
2001 Continued expansion into Europe through acquisition of Ellis amp Everard
2011 Completed acquisition of chemical distributor Quaron complementing our European foothold in specialty chemicals with expanded product portfolio and increased logistical capability
2013 Expanded presence in Mexico with the acquisition of Quimicompuestos making us a leading chemical distributor in the market
2007 Acquired ChemCentral enabling us to improve market share and operational efficiencies in North America
2010 Acquired Basic Chemical Solutions (ldquoBCSrdquo) enhancing our ability to provide value in the company chemical end-users supply chain strengthen global sourcing capabilities and expand our inorganic chemicals presence
1920
1986 Acquired McKesson Chemical Corporation solidifying US presence and making us the largest chemical distributor in North America
September 2018 Announced agreement to acquire Nexeo Solutions to create the largest North American sales force broadest product offering and most efficient supply chain in the industry
March 2019 Completed acquisition of Nexeo Solutions and April sale of Nexeorsquos Plastics Distribution Business enabling a concentration on core chemical distribution and opportunities created by the Nexeo Solutions and Univar combination
1980 2000 2005 2010 2015 2019
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
2
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
This presentation includes certain statements relating to future events and our intentions beliefs expectations and predictions for the future which are ldquoforward-looking statementsrdquo within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 as amended Forward-looking statements are subject to known and unknown risks and uncertainties many of which may be beyond our control These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the expectations and assumptions A detailed discussion of these factors and uncertainties is contained in the companys filings with the Securities and Exchange Commission Potential factors that could affect such forward-looking statements include among others fluctuations in general economic conditions particularly in industrial production and the demands of our customers significant changes in the business strategies of producers or in the operations of our customers increased competitive pressures including as a result of competitor consolidation significant changes in the pricing demand and availability of chemicals our indebtedness the restrictions imposed by our debt instruments and our ability to obtain additional financing the broad spectrum of laws and regulations that we are subject to including extensive environmental health and safety laws and regulations an inability to integrate the business and systems of companies we acquire including of Nexeo Solutions Inc or to realize the anticipated benefits of such acquisitions potential business disruptions and security breaches including cybersecurity incidents an inability to generate sufficient working capital increases in transportation and fuel costs and changes in our relationship with third party providers accidents safety failures environmental damage product quality and liability issues and recalls major or systemic delivery failures involving our distribution network or the products we carry operational risks for which we may not be adequately insured ongoing litigation and other legal and regulatory risks challenges associated with international operations exposure to interest rate and currency fluctuations potential impairment of goodwill liabilities associated with acquisitions ventures and strategic investments negative developments affecting our pension plans and multi-employer pensions labor disruptions associated with the unionized portion of our workforce loss of key personnel and the other factors described in the Companys filings with the Securities and Exchange Commission We caution you that the forward-looking information presented in this presentation is not a guarantee of future events or results and that actual events or results may differ materially from those made in or suggested by the forward-looking information contained in this presentation In addition forward-looking statements generally can be identified by the use of forward-looking terminology such as ldquomayrdquo ldquoplanrdquo ldquoseek ldquowillrdquo ldquoexpectrdquo ldquointendrdquo ldquoestimaterdquo ldquoanticipaterdquo ldquobelieverdquo or ldquocontinuerdquo or the negative thereof or variations thereon or similar terminology Any forward-looking information presented herein is made only as of the date of this presentation and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions the occurrence of unanticipated events or otherwise
This presentation includes certain non-GAAP financial measures intended to supplement not substitute for comparable GAAP measures Furthermore the non-GAAP financial measures presented herein may not be consistent with similar measures provided by other companies Reconciliations of non-GAAP financial measures to GAAP financial measures are provided in the Appendix at the end of the presentation Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those measures provided in the Appendix This data should be read in conjunction with Univar Solutions periodic reports previously filed with the SEC
Non-GAAP Measures
Forward-Looking Statements
3
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
About Univar Solutions
We are a leading global chemical and ingredient distributor and provider of specialty servicesPurchase chemicals and ingredients from thousands of producers and warehouse repackage blend dilute transport and sell worldwide
1) As of December 31 2019-amounts do not include Nexeo Plastics2) Source ICIS Top 100 Chemical Distributors
Nimble and resilient regardless of market conditions
Diverse Customer BaseTop 10 customers represent ~10 of sales
Asset Light Model 10-year average capexsales of 12
Diverse End MarketsNo end market represents more than ~20 of sales
CANADA 13
US 63
EMEA 19
LATAM 5
Net Sales by Region(1)
1 market position in
the US (2)
3 market position in
EMEA(2)
1 market position in
Canada(2)
Diverse Supplier BaseTop 20 premier suppliers(2) represent ~47 of
chemical purchases
4
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
LATAM9 Solutions Centers
EMEA12 Solution Centers
CANADA7 Solution Centers
USA17 Solution Centers
APAC3 Solution Centers
Customer Application and Formulation Development Expertise
Solution Centers Verticals
Lab-based Technical Employees
Field-based Technical
Employees
Total Technical Employees
56 80 136
ENERBPC CASEFOODHIC LMWF PHAR AGSOLV ALL
48 Global Solution Centers Opportunity to differentiate through real technical
leadershipbull Specialized Expertisebull Innovative Capabilitiesbull 247 Servicebull Formulating Prototypingbull Blending Testing amp Analysis
5
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Corporate History A 95 year old ldquoNewrdquo Company
1924 Founded as a brokerage business
April 2015 Acquired Key Chemical Inc one of the largest distributors of fluoride to municipalities in the US expanding our offerings into the municipal and other industrial markets
June 2015 Oversubscribed IPO and concurrent private placement resulted in approximately $760 million net proceedsused to pay the remaining principal balance of Senior Subordinated Notes began trading on NYSE
2001 Continued expansion into Europe through acquisition of Ellis amp Everard
2011 Completed acquisition of chemical distributor Quaron complementing our European foothold in specialty chemicals with expanded product portfolio and increased logistical capability
2013 Expanded presence in Mexico with the acquisition of Quimicompuestos making us a leading chemical distributor in the market
2007 Acquired ChemCentral enabling us to improve market share and operational efficiencies in North America
2010 Acquired Basic Chemical Solutions (ldquoBCSrdquo) enhancing our ability to provide value in the company chemical end-users supply chain strengthen global sourcing capabilities and expand our inorganic chemicals presence
1920
1986 Acquired McKesson Chemical Corporation solidifying US presence and making us the largest chemical distributor in North America
September 2018 Announced agreement to acquire Nexeo Solutions to create the largest North American sales force broadest product offering and most efficient supply chain in the industry
March 2019 Completed acquisition of Nexeo Solutions and April sale of Nexeorsquos Plastics Distribution Business enabling a concentration on core chemical distribution and opportunities created by the Nexeo Solutions and Univar combination
1980 2000 2005 2010 2015 2019
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
3
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
About Univar Solutions
We are a leading global chemical and ingredient distributor and provider of specialty servicesPurchase chemicals and ingredients from thousands of producers and warehouse repackage blend dilute transport and sell worldwide
1) As of December 31 2019-amounts do not include Nexeo Plastics2) Source ICIS Top 100 Chemical Distributors
Nimble and resilient regardless of market conditions
Diverse Customer BaseTop 10 customers represent ~10 of sales
Asset Light Model 10-year average capexsales of 12
Diverse End MarketsNo end market represents more than ~20 of sales
CANADA 13
US 63
EMEA 19
LATAM 5
Net Sales by Region(1)
1 market position in
the US (2)
3 market position in
EMEA(2)
1 market position in
Canada(2)
Diverse Supplier BaseTop 20 premier suppliers(2) represent ~47 of
chemical purchases
4
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
LATAM9 Solutions Centers
EMEA12 Solution Centers
CANADA7 Solution Centers
USA17 Solution Centers
APAC3 Solution Centers
Customer Application and Formulation Development Expertise
Solution Centers Verticals
Lab-based Technical Employees
Field-based Technical
Employees
Total Technical Employees
56 80 136
ENERBPC CASEFOODHIC LMWF PHAR AGSOLV ALL
48 Global Solution Centers Opportunity to differentiate through real technical
leadershipbull Specialized Expertisebull Innovative Capabilitiesbull 247 Servicebull Formulating Prototypingbull Blending Testing amp Analysis
5
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Corporate History A 95 year old ldquoNewrdquo Company
1924 Founded as a brokerage business
April 2015 Acquired Key Chemical Inc one of the largest distributors of fluoride to municipalities in the US expanding our offerings into the municipal and other industrial markets
June 2015 Oversubscribed IPO and concurrent private placement resulted in approximately $760 million net proceedsused to pay the remaining principal balance of Senior Subordinated Notes began trading on NYSE
2001 Continued expansion into Europe through acquisition of Ellis amp Everard
2011 Completed acquisition of chemical distributor Quaron complementing our European foothold in specialty chemicals with expanded product portfolio and increased logistical capability
2013 Expanded presence in Mexico with the acquisition of Quimicompuestos making us a leading chemical distributor in the market
2007 Acquired ChemCentral enabling us to improve market share and operational efficiencies in North America
2010 Acquired Basic Chemical Solutions (ldquoBCSrdquo) enhancing our ability to provide value in the company chemical end-users supply chain strengthen global sourcing capabilities and expand our inorganic chemicals presence
1920
1986 Acquired McKesson Chemical Corporation solidifying US presence and making us the largest chemical distributor in North America
September 2018 Announced agreement to acquire Nexeo Solutions to create the largest North American sales force broadest product offering and most efficient supply chain in the industry
March 2019 Completed acquisition of Nexeo Solutions and April sale of Nexeorsquos Plastics Distribution Business enabling a concentration on core chemical distribution and opportunities created by the Nexeo Solutions and Univar combination
1980 2000 2005 2010 2015 2019
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
4
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
LATAM9 Solutions Centers
EMEA12 Solution Centers
CANADA7 Solution Centers
USA17 Solution Centers
APAC3 Solution Centers
Customer Application and Formulation Development Expertise
Solution Centers Verticals
Lab-based Technical Employees
Field-based Technical
Employees
Total Technical Employees
56 80 136
ENERBPC CASEFOODHIC LMWF PHAR AGSOLV ALL
48 Global Solution Centers Opportunity to differentiate through real technical
leadershipbull Specialized Expertisebull Innovative Capabilitiesbull 247 Servicebull Formulating Prototypingbull Blending Testing amp Analysis
5
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Corporate History A 95 year old ldquoNewrdquo Company
1924 Founded as a brokerage business
April 2015 Acquired Key Chemical Inc one of the largest distributors of fluoride to municipalities in the US expanding our offerings into the municipal and other industrial markets
June 2015 Oversubscribed IPO and concurrent private placement resulted in approximately $760 million net proceedsused to pay the remaining principal balance of Senior Subordinated Notes began trading on NYSE
2001 Continued expansion into Europe through acquisition of Ellis amp Everard
2011 Completed acquisition of chemical distributor Quaron complementing our European foothold in specialty chemicals with expanded product portfolio and increased logistical capability
2013 Expanded presence in Mexico with the acquisition of Quimicompuestos making us a leading chemical distributor in the market
2007 Acquired ChemCentral enabling us to improve market share and operational efficiencies in North America
2010 Acquired Basic Chemical Solutions (ldquoBCSrdquo) enhancing our ability to provide value in the company chemical end-users supply chain strengthen global sourcing capabilities and expand our inorganic chemicals presence
1920
1986 Acquired McKesson Chemical Corporation solidifying US presence and making us the largest chemical distributor in North America
September 2018 Announced agreement to acquire Nexeo Solutions to create the largest North American sales force broadest product offering and most efficient supply chain in the industry
March 2019 Completed acquisition of Nexeo Solutions and April sale of Nexeorsquos Plastics Distribution Business enabling a concentration on core chemical distribution and opportunities created by the Nexeo Solutions and Univar combination
1980 2000 2005 2010 2015 2019
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
5
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Corporate History A 95 year old ldquoNewrdquo Company
1924 Founded as a brokerage business
April 2015 Acquired Key Chemical Inc one of the largest distributors of fluoride to municipalities in the US expanding our offerings into the municipal and other industrial markets
June 2015 Oversubscribed IPO and concurrent private placement resulted in approximately $760 million net proceedsused to pay the remaining principal balance of Senior Subordinated Notes began trading on NYSE
2001 Continued expansion into Europe through acquisition of Ellis amp Everard
2011 Completed acquisition of chemical distributor Quaron complementing our European foothold in specialty chemicals with expanded product portfolio and increased logistical capability
2013 Expanded presence in Mexico with the acquisition of Quimicompuestos making us a leading chemical distributor in the market
2007 Acquired ChemCentral enabling us to improve market share and operational efficiencies in North America
2010 Acquired Basic Chemical Solutions (ldquoBCSrdquo) enhancing our ability to provide value in the company chemical end-users supply chain strengthen global sourcing capabilities and expand our inorganic chemicals presence
1920
1986 Acquired McKesson Chemical Corporation solidifying US presence and making us the largest chemical distributor in North America
September 2018 Announced agreement to acquire Nexeo Solutions to create the largest North American sales force broadest product offering and most efficient supply chain in the industry
March 2019 Completed acquisition of Nexeo Solutions and April sale of Nexeorsquos Plastics Distribution Business enabling a concentration on core chemical distribution and opportunities created by the Nexeo Solutions and Univar combination
1980 2000 2005 2010 2015 2019
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
6
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Chemical Distribution Industry Overview
bull Historically viewed as a channel to reach smaller customers but increasingly becoming critical to larger manufacturers
bull High number of small local participants
bull Industry-wide underinvestment in software and digitization
ndash Advanced ERP expected to simplify logistics and reduce complexity and costs
Market GrowthGDP | Industrial production | Solutions focused
Digitization Expand reach | Lower cost to serve
Industry Consolidation Highly fragmented | Driven by suppliers and customers
Sales Force EffectivenessHighly trained | Compensation aligned with profitable growth
RegulatoryIndustry leading safety | Increasing complexity | Barriers to entry
Outsourcing with Key Value Chemical amp Ingredient SuppliersSupplier driven | Underpenetrated addressable market
Univar Solutions Attractive Growth Drivers
$200B+Top three distributors account for ~10 of
the market
Univar SolutionsBrenntag
IMCD
Global Third-Party Chemical Distribution (1)
1) Source internal industry analysis
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
7
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Diversified End Markets Provide Stability of Earnings and Cash Flow
17
10
7
6
666
6
5
4
322
20
Coatings amp Adhesives
Chemical Manufacturing
Agricultural amp Environmental Sciences
Food Ingredients amp Products
Energy amp Power Generation
Homecare amp Industrial Cleaning
Beauty amp Personal Care
Pharmaceuticals Ingredients amp Finished Products
Upstream OampG
Water treatment
Metalworking amp Lubricants
Forestry Lumber Paper
Wholesale amp Retail
Other
Note Based on 2019 Net Sales for legacy Univar and Nexeo businesses excluding divested Nexeo Plastics business ldquoOtherrdquo represents markets where we had less than 2 Net Sales in 2019
(1)
(1) Comprised of multiple sub end markets including Coatings amp Adhesives Color amp Compound Industrial Markets and Paint amp Coating
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
8
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Multi-channel Go-to-Market Model Differentiates Univar Solutions
We connect with our customers through three interdependent channels that leverage our capabilities and deliver high value through Univar Solutions teams that possess specialized knowledge and expertise
Local Chemical DistributionWe are experts in understanding local geographic markets and our customersrsquo needs and challenges in those markets
End Market VerticalsWe are dedicated to serve select industries and the technical needs and growth opportunities unique to each market
Bulk Chemical DistributionWe help address the unique challenges of sourcing and delivering large-volume commodity chemicals
Supported by Digital and Supply Chain Platform
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
9
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Customer Value Proposition
Enhanced digital offerings and reduced cost of service will strengthen bonds with customers and suppliers and increase profitability over the long-term
Simplified safe and reliable sourcing for a lower total cost of service
Chemical distribution is hazardous and highly regulated Industry leading safety and security ratings
Lack of software adoption with near zero inventory visibility
Continued investments in digitization unlocks customersrsquo ability to better manage inventory and operational efficiency
Highly fragmented distribution partners often chosen by local plant managers
Nationwide scale can provide a lower cost of service and reduced vendor list
Customer Challenges Univar Solutions
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
10
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Our Growth Plan
Grow Market
Increase Share
bull Value-based pricing
bull Mix enrichmentbull Warehouse and logistics productivity
ImproveMargins
bull Sales force effectiveness
bull Leverage scalebull Improve customer satisfaction
bull Win new product authorizations
bull Technical solutions centers
bull Grow with strategic partners
Accelerate Digitization with Customers Suppliers and Back-end Processes
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
11
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Recent Acquisitions and Divestiture Developments
ACQUISITION OF NEXEO SOLUTIONS DIVESTITURE OF NEXEO PLASTICS DIVESTITURE OF UNIVAR ES BUSINESS(1)
Announced September 17 2018Closed February 28 2019Transaction Details
bull Acquired Nexeo Solutions for a total transaction value of ~$18 billion
bull Mix of approximately $12 billion of cash and $06 billion of equity
Rationalebull Industry leading servicebull Comprehensive product portfolio to
upsell and cross-sell Complementary go to market strategy
bull Differentiated customer experiencebull Increased scale across key channels
geographies and suppliers $120M net cost synergies
bull Strong digital capabilities through Nexeorsquo s ERP platform lead to future innovation
Announced February 8 2019Closed March 29 2019Transaction Details
bull Sold Nexeo Plastics division to One Rock Capital for approximately $667 million
Rationalebull Allowed focus on its core business
growth through chemical and ingredients distribution
bull Opportunity to reduce leverage
Announced December 6 2019Closed December 31 2019Transaction Details
bull Sold Environmental Sciences business to AEA Investors for $195 million subject to working capital adjustments
Rationalebull Intensify strategic focus on core
chemicals and ingredients businessbull Avoidance of SAP migration and other
costly investmentsbull Opportunity to reduce leverage
(1) For full transaction details please refer to 8-K filed on January 6 2020
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
12
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priorities
We will continue to streamline innovate and grow redefining chemical distribution to achieve our vision of being the most valued chemical and ingredient distributor on the planet
bull Simplify business processes eliminate bottlenecks and structurally reduce our cost base to improve our value proposition for customers
bull Accelerate the development of our digital platform from the foundation of Univar and Nexeorsquos complementary IT capabilities
bull Continue growth through improvement in the execution of our sales force emphasis on focused industries and contributions from Nexeo
Streamline
Innovate
Grow
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
13
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Streamline to Reduce Cost of Service
bull Rationalizing the footprint
bull Leveraging scale
bull Removing redundancies within processes
bull Eliminating bottlenecks
bull Improving asset utilization
bull Becoming more flexible and agile
bull Fostering a world-class supply chain that will drive higher returns and eliminate waste
$120 million(1)
In annual operating net cost synergies
$15 million(1)
in annual CapEx savings
bull Optimizing our facilities network and assets IT and infrastructure
bull Consolidating both companies business support functions
bull Consolidating maintenance CapEx spendbull Leveraging Nexeos existing IT investments
Nexeo Solutions projected acquisition benefits
Streamlining to create a sustainable competitive advantage and a win-win for customer and supplier partners
Opportunity to structurally reduce costs through
expected
expected
1) Projected as of February 25 2020 expected to be realized three years after acquisition close date of Feb 28 2019
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
14
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Innovate to Enhance Service Offering with Software
Offers customers industry-leading e-commerce capabilities
Enhances supply chain transparency and efficiency
Allows for improvement in customer service areas such as inventory order management
Analytics drive cross-sell and next-product-to-sell strategiesCombined global digital capabilities
Univar Solutions
Univar and Nexeorsquos complementary IT capabilities serve as a foundation to accelerate the digital platform
Financial systems amp ERP platformNexeo
State-of-the art ERP platform in NA with an architecture nearly identical to Univar EMEA
Benefits of increased digitization
E-commerce amp digital capabilitiesUnivar
State-of-the art ERP platform developed for EMEA
Accelerated time to market reduced implementation risk and CapEx spending
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
15
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow Through Improved Sales Force Efficiency
Nexeo transaction increases benefits from ongoing sales force transformation
Key learnings from Nexeorsquos sales force transition being applied
Deeper sales force penetration and market research
Expedited shift from transactional to consultative sales
Re-energized sellers with potential to grow their business
Reduced sales force attrition for both Univar and Nexeo
Streamlined back end processes
Additional capacity for prospecting new business
‒ Maintain sales force of combined companies will create an estimated 20-25 free capacity to grow and sell to new customers
bull Larger opportunity pipelines for sellersbull Increased calls to customers +20-25 since beginning
of sales force transformation
bull Higher close rates and delivered gross profit dollars bull Better brand stewards and advocates for supplier
partners
Benefits of Sales Force Training Programs
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
16
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strategic Priority Grow in Focused Industries
With new strength and scale in our portfolio we are well-positioned within our focused industries
bull Unmatched sales force execution brand advocacy and price stewardship
bull Enhanced go-to-market strategy combining in-depth experience with a global reach and local focus
bull State-of-the-art solution centers worldwide
bull Broad knowledge and a deep combined legacy Univar Nexeo product portfolio that reflect market demand and emerging trends
Two new focused industries in the US
Food ingredients
Personal care
Pharmaceutical ingredients
Coatings adhesives sealants and elastomers
(ldquoCASErdquo) Home care and industrial cleaning
Lubricants and metalworking
Solvents
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
17
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
6 Key Metrics to Gauge Our Progress
Gross Profit $(exclusive of depreciation)(2) Growth(1)
Adjusted EBITDA $(2)
Cash Flow $
Return on Invested Capital(2)
Leverage Ratio(2)
Synergy Capture
Growth
Stable Free Cash Flow(2) counter-cyclical nature reduces risk
Asset light model and rising attractive ROIC
Lower leverage provides strength and flexibility
Enhances profitability improves competitive position
(1) The Company assesses gross profit dollar growth performance by account customer and operating segment(2) Non-GAAP financial measures see appendix for definitions page
Metric Investors Should Expect
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
18
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Long-Term Growth in Adjusted EBITDA and Margins
Compounded Adjusted EBITDA growth rate of ~8 since 2005 exceeds GDP growth
$ millions
Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measureNote Numbers for 2012 and prior years have not been retrospectively adjusted for the retirement benefit restatement ASU 2017-07
$250 $282 $333
$498$438
$499
$646 $607 $581 $625$573 $547 $594 $640
$70442 43 41
53
61 6366
6256
6064
6872 74 76
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Adjusted EBITDA Adjusted EBITDA Margin
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
19
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Performance in a DownturnSemi-variable cost structure limits financial downside during a downturn
Peak Adjusted EBITDA Decline -120
Duration of Downturn4 quarters
Duration Until Full Recovery
4 quarters$ millions
2006 2007 2008 2009 2010 2011
$282
$333
$498
$438
$499
$646
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Post-crisis trough
Full recovery
Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Note figures show LTM Adjusted EBITDA
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
20
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Resilient Operating Cash FlowCash flow generation is resilient through various market environments ndash including 2009
$ millions
$231
$9
$217
$27
$262
$16
$289
$126
$356
$450
$283 $290
$364
($92) ($78) ($66)($92) ($103)
($170)($141)
($114)($145)
($90) ($83) ($95) ($123)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Net cash provided by operating activities Capital expenditures
Note Numbers for 2012 and prior years do not reflect retrospective reclassification for ASU 2016-15
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
21
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
69
98110
101
2016 2017 2018 2019
1) Legacy Univar results ROIC calculated as Adjusted Net Income(2) divided by Net Assets Deployed2) Non-GAAP financial measures see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
Return on Invested Capital
Asset light business model drives attractive Return on Invested Capital (1 2)
We expect continued ROIC (1)
increase as value capture program
progresses
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
22
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$3666$2963 $2643 $2428 $2259 $2384
59x
52x48x
41x35x
33x
2014 2015 2016 2017 2018 2019Net Debt Leverage Ratio
1) Leverage ratio represents Net Debt LTM Adjusted EBITDA including full-year impact of Nexeo Chemicals business2) As of Q4 2019 includes swaps3) Non-GAAP financial measure see appendix for definitions page and reconciliation to the most comparable GAAP financial measure
LeverageConsistent de-leveraging and improving credit quality
Net Debt and Leverage Ratio (1)(3)
Upgraded by Moodyrsquos and SampP to Ba3BB in Feb 2019
WACD(2) 425
Floating (2) 19
Fixed(2) 81
Additional debt metrics
Upgraded by Moodyrsquos to B2
following equity IPO in June 2015
(3) (3)
Upgraded by Moodyrsquos to B1 in Oct 2017
Upgraded by SampP to B+ in June 2017
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
23
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
$4 $135 $4 $4
$1642
$4$376 $500
2020 2021 2022 2023 2024 2025 2026 2027
Capital AllocationCapital is deployed to drive profitable growth and maximize returns on investment
bull Goal to reduce leverage to less than 30x (4)
bull Weighted average cost of debt 425(1)
Strengthen Balance Sheet
1) As of Q4 2019 includes swaps2) Long term debt as of Q4 2019 and excludes finance lease obligations3) 2024 maturities comprised of $200 North America ABL Facility outstanding $1438 USD TLB-3 $4 USD TLB-54) Non-GAAP financial measure see appendix for definitions page
Debt Maturities (2)
$ millions
Debt Repayments
Reinvest in the Business
bull Increased investment in digitization
bull Improving sales force effectiveness
Divestments
bull Thorough portfolio review to determine value maximization
Opportunistic Acquisitions
bull Evaluate bolt-on acquisitions with high ROIC potential
(3)
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
24
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Timeline of Corporate Governance Enhancements
2017 2019 20202015
June 2015bull Debuted on public markets
through IPO
May 2018bull Amended bylaws to implement majority voting standard
(with resignation policy) for director elections
August 2018bull Amended charter to declassify Board (in progress) bull Amended bylaws to provide proxy access right
September 2018 bull Announced agreement to acquire Nexeo Solutions
We have steadily adopted changes to our governance structure to evolve from a private to a public company
May 2019bull Elected Christopher Pappas as
Independent Lead DirectorAugust 2019bull Adopted new retirement policy for Board
where any director who is 75 or older cannot stand for reelection
September 2019bull CDampR fully exited its position and
directorshipsDecember 2019bull Stephen Newlin retired as an employee of
the Company and will serve as Non-Executive Chairman until the 2020 annual meeting
May 2020bull Continue to take planned steps
to evolve to an appropriate Board size
bull Christopher Pappas to become Independent Chairman
2016 2018
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
25
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Global Sustainability Goalsbull Our global sustainability goals first set out in 2017 remain the cornerstone of incorporating sustainability into our strategy and growth plansbull These goals focusing on our six key areas of responsibility run to 2021 with performance evaluated through our specific measurable
achievable realistic and time-bound targets
Energy amp EmissionsMinimize environmental impact by
reducing energy usage and associated emissions
Resource UseEmbed the principles of advancing
the circular economy into our practices globally
Responsible HandlingProtect our people communities
and environment by leading a ldquoZero Releaserdquo culture to minimize major
releases
SafetyContinuously improve our proud
safety record protecting our workforce and demonstrating we are
serious about safety
Sustainable Supply ChainLead on transparency in the supply
chain as we responsibly manage and influence the environmental and
social impact of our suppliers
Equality Diversity amp InclusionDemonstrate our commitment to
providing equal and equitable opportunities to all employees
through training education and an inclusive culture
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
26
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Constantly improving workplace safety resulting in fewer average injuries compared
to peers and comparable industries We reduced our Total Case Incident Rate (TCIR (2))
from 169 in 2011 to 058 in 2019 an improvement of just over 66
Update on Global Sustainability Goals
Resource Use Responsible Handling
Safety Sustainable Supply Chain Equality Diversity amp Inclusion
Energy amp Emissions
By 2021 we plan to reduce energyuse (MWh) and emissions (tCO2e) 15 from
2016 baseline per million USD in sales
By 2021 we plan to reduce hazardous waste by 15 against 2016
baseline per million USD in sales
Working tirelessly to help reduce the likelihood and significance of unintended release
across the regions
By 2021 we will establish and implement assessment of
product suppliers for environmental and social responsibility in all regions
Engaging with suppliers to disclose and develop performance around
environmental and social responsibility is key to fostering better business
Globally implemented an improved ethics alert line system and confidential survey tools to facilitate reporting where employees
are concerned about unethical behaviors
Our goal is to achieve and exceed the global TCIR (2) goal of 068 each year
Our performance in 2019 was strong and we are confident in our ability to deliver further meaningful improvements across our areas of focus to achieve our 2021 goals (1)
1) Full report at wwwunivarsolutionscomsafety-and-sustainabilitysustainabilityresources-reporting2) TCIR is the US Occupational Safety and Health Administration (OSHA) standardized methodology for calculating the rate of recordable injuries per 200000 hours worked
By 2021 we plan to achieve a15 absolute reduction in significant spills
against 2016 baseline
Following the prior launch of our Women LGBT+ amp Veterans Network Group we will be
launching our Ability Network Latino amp Hispanic Network and Black Growth Network in 2020
Advancing the principles of the economy through our operations and supply chain
We are transitioning to less carbon intensive operations and have pledged to long-term
reductions supporting a limit in global temperature rise
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
27
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Appendix
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
28
copy 2019 Univar Inc All rights reserved Confidential and content subject to changecopy 2019 Univar Inc All rights reserved Confidential and content subject to change
To supplement the consolidated financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) the Company uses certain non-GAAP historical financial measures In particular the Company presents the non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA margin leverage ratio and net debt Return on invested capital is derived using the non-GAAP historical financial measure of adjusted net income Management uses these non-GAAP financial measures internally for strategic decision making forecasting future results and evaluating current performance Management believes these non-GAAP financial measures help investorsrsquo ability to analyze underlying trends in the Companyrsquos business evaluate its performance relative to other companies in its industry and provide useful information to both management and investors by excluding certain items that may not be indicative of the Companyrsquos core operating results Additionally the Company uses Adjusted EBITDA in setting performance incentive targets to align management compensation with operational performance and uses return on invested capital to measure attainment of certain performance share units earned The non-GAAP measures should not be considered a substitute for or superior to GAAP results and may vary from others in the industry
Non-GAAP financial measures are not prepared in accordance with GAAP therefore the information is not necessarily comparable to other companies A reconciliation of each non-GAAP historical financial measure to the most comparable GAAP measure is provided in the following pages
Non-GAAP Financial Measures
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
29
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Strong relationships with premier global suppliers
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
30
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Semi-Variable Operating Costs
Selling
Commissions (variable) headcount (semi-
variable)
Administrative
Rent amp utilities (fixed) salaries (fixed
fluctuates with inflation)
Warehouse
Fixed (fluctuates with inflation)
Outbound Freight amp Handling
Variable
Core Components of Operating Expenses
Enables us to adjust our cost base quickly if economic conditions change
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
31
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
Definitionsbull Adjusted EBITDA ndash Adjusted EBITDA is defined as consolidated net (loss) income plus the sum of net (income) loss from discontinued operations net interest
expense income tax expense depreciation amortization other operating expenses net (which primarily consists of employee stock-based compensation expense restructuring charges litigation settlements other employee termination costs other facility exit costs acquisition and integration related expenses and other unusual or non-recurring expenses) loss on extinguishment of debt and other (expense) income net (which consists of gains and losses on foreign currency transactions and undesignated derivative instruments non-operating retirement benefits and other non-operating activity) and in 2019 inventory step-up adjustment and Brazil VAT recovery
bull Adjusted EBITDA Margin ndash Adjusted EBITDA divided by net sales on a consolidated level and by external sales on a segment level
bull Constant Currency ndash Excludes the impact of fluctuations in foreign currency exchange rates Currency impacts on consolidated and segment results have been derived by translating current period financial results in local currency using the average exchange rate for the prior period to which the financial information is being compared
bull Conversion Ratio ndash Adjusted EBITDA divided by gross profit (exclusive of depreciation)
bull Delivered Gross Profit ndash Gross profit (exclusive of depreciation) less outbound freight and handling
bull Free Cash Flow ndash GAAP net cash provided (used) by operating activities less capital expenditures before integration and transaction related costs
bull Gross Profit (exclusive of depreciation) ndash Net sales less cost of goods sold (exclusive of depreciation)
bull Gross Margin ndash Gross profit (exclusive of depreciation) divided by net sales on a consolidated level and by external sales on a segment level
bull Leverage Ratio - Net debt divided by last twelve months (LTM) Adjusted EBITDA as defined in the Companys credit agreements excluding the impact of Nexeo acquisition synergies not yet realized
bull Net Assets Deployed ndash Average net working capital (trade accounts receivable plus inventory less trade accounts payable) plus average net property plant amp equipment
bull Return on Invested Capital ndash Last twelve months (LTM) Adjusted net income divided by net assets deployed
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
32
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Net income (loss) 1213$ 1333$ 467$ (80)$ (22)$ (706)$ (1762)$ (1974)$ (823)$ (201)$ 165$ (684)$ 1198$ 1723$ (1002)$ Net income from discontinued operations - - - - - - - - - - - - - - (54) Depreciation amortization 414 466 816 1324 1264 1286 1984 2050 2281 2295 2250 2379 2004 1795 2147 Interest expense net 279 310 1270 3156 3072 3019 2736 2681 2945 2506 2070 1599 1480 1324 1395 Income tax expense (benefit) 589 712 596 187 142 304 159 756 (98) (158) 102 (112) 490 499 1045 EBITDA 2495 2821 3149 4587 4456 3903 3117 3513 4305 4442 4587 3182 5172 5341 3531 Other operating (income) expense net (2) - - - - (391) 862 1403 1777 855 793 890 372 554 735 2982 Other expense (income) net (1)(2) - - 179 393 (46) (45) 40 19 (734) 998 135 581 174 327 705 Impairment charges - - - - 360 126 1739 758 1356 03 - 1339 - - 70 Gain on sale of business - - - - - - - - - - - - - - (414) Loss on extinguishment of debt - - - - - 145 161 05 25 12 121 - 38 01 198 Brazil VAT recovery - - - - - - - - - - - - - - (83) Inventory step-up adjustment - - - - - - - - - - - - - - 53 Adjusted EBITDA (1) 2495$ 2821$ 3328$ 4980$ 4379$ 4991$ 6460$ 6072$ 5807$ 6248$ 5733$ 5474$ 5938$ 6404$ 7042$
Appendix - GAAP Net (Loss) Income to Adjusted EBITDA Reconciliation
2013-2018 Notes(1) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits interest cost expected return on assets and prior service credits(2) Retirement benefit restatement adjustments for 2013-2018 include pension and other post retirement benefits mark to market gainloss curtailments and settlements
2005-2012 Notes(1) 2005-2012 numbers have not been retrospectively adjusted for ASU 2017-07 Do not include retirement benefit restatement adjustments for pension and other post retirement benefits interest cost expected return on assets and prior
service credits(2) 2005-2012 numbers do not include retirement benefit restatement adjustments for pension and other post retirement benefits mark to market gainloss curtailments and settlements
33
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
2017 2018 2019Net (loss) income 1198$ 1723$ (1002)$ Net income from discontinued operations - - (54) Pension mark to market loss (1) 38 342 504 Pension curtailment and settlement gains (1) (97) - (13) Other non-recurring pension items - 25 - Exchange (gain) loss (1) 225 75 (74) Derivative loss (gain) (1) 19 (11) 267 (Gain) loss on sale of business property plant and equipment and other assetss (1) (113) 20 (513) Restructuring employee severance and other facility closure costs (1) 136 212 409 Impairment charges - - 70 Inventory step-up adjustment - - 53 Brazil VAT recovery - - (83) Loss on extinguishment of debt and debt refinancing costs 91 01 210 Acquisition and integration related costs (1) 31 220 1521 Saccharin legal settlement (1) 625 Transformation costs (1) 234 - - Other (1) 104 107 306 Income tax expense (benefit) related to reconciling items (2) (121) (256) 95 US tax legislation (2) 366 - - Other discrete tax items (2) (140) (156) (05) Adjusted net income 1971$ 2302$ 2316$
Appendix - Reconciliation of Net (Loss) Income to Adjusted Net Income
(1) Reconciling items represent items disclosed in Note 6 Other operating expenses net and Note 8 Other expense net in Item 8 of our Annual Report on Form 10-K for the year ended December 31 2019excluding stock-based compensation and non-operating retirement benefits
(2) Tax on reconciling items is calculated as the difference between the tax provisions on US GAAP pre-tax earnings and Adjusted pre-tax earnings utilizing the appropriate tax rates and laws of each jurisdiction
34
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
($ in millions) 2014 2015 2016 2017 2018 2019Total short-term and long-term debt 38113$ 31173$ 29540$ 28820$ 23721$ 27138$ Add Short-term financing 611 335 253 134 81 07 Less Cash and cash equivalents (2060) (1881) (3364) (4670) (1216) (3303)
Total net debt 36664$ 29627$ 26429$ 24284$ 22586$ 23842$
LTM Adjusted EBITDA(1) 6248$ 5733$ 5474$ 5938$ 6404$ 7254$
Leverage ratio (Total net debtLTM Adjusted EBITDA) 59x 52x 48x 41x 35x 33x
Appendix ndash GAAP Debt to Net Debt Reconciliation
(1) LTM Adjusted EBITDA as defined by the Companys credit agreements excluding the impact of synergies not yet realized includes two and five months of Nexeo Chemicals Adjusted EBITDA for December 31and September 30 2019 respectively based on the 2018 full year estimate of $127 million for the periods prior to the acquisition on February 28 2019 LTM Adjusted EBITDA in 2018 does not include anestimate of Nexeo Chemicals Adjusted EBITDA
35
copy 2019 Univar Inc All rights reserved Confidential and content subject to change
- StreamlineInnovateGrow
- Slide Number 2
- About Univar Solutions
- Customer Application and Formulation Development Expertise
- Our Corporate History A 95 year old ldquoNewrdquo Company
- Chemical Distribution Industry Overview
- Slide Number 7
- Multi-channel Go-to-Market Model Differentiates Univar Solutions
- Customer Value Proposition
- Our Growth Plan
- Recent Acquisitions and Divestiture Developments
- Strategic Priorities
- Strategic Priority Streamline to Reduce Cost of Service
- Strategic Priority Innovate to Enhance Service Offering with Software
- Strategic Priority Grow Through Improved Sales Force Efficiency
- Strategic Priority Grow in Focused Industries
- 6 Key Metrics to Gauge Our Progress
- Long-Term Growth in Adjusted EBITDA and Margins
- Performance in a Downturn
- Resilient Operating Cash Flow
- Return on Invested Capital
- Leverage
- Capital Allocation
- Slide Number 24
- Global Sustainability Goals
- Slide Number 26
- Slide Number 27
- Slide Number 28
- Slide Number 29
- Semi-Variable Operating Costs
- Slide Number 31
- Slide Number 32
- Slide Number 33
- Slide Number 34
- Slide Number 35
-
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