Elementis Annual Review Presentation

1
Elementis plc Annual General Meeting
Thursday 28 April 2005
2
Elementis plc
3
Full year highlights

• Sales increase to 389.2 m(2003 368.2 m)
• Operating profit (before goodwill amortisation
  and exceptionals) 11.8 m(2003 24.5 m)
• Successful implementation of structural
  improvements in all businesses
• Selling prices of chromium now at highest level
  since 2001
• But - raw material, energy, freight and currency
  movements all adverse

4
Strategy

• Chromium market leadership
• Specialties innovation
• Pigments cost leadership
• Specialty Rubber leverage quality
• Systems operational excellence

• Chromium rationalisation
• Specialties growth
• Pigments cost base
• Specialty Rubber focus and volume
• Systems sustainability

Fix the obvious
Business strategies
Growth
Acquisitions

• OxyChem
• Sasol Servo

5
Specialties and Pigments
m 2004
2003 Sales 238.2
209.3 Operating Profit 15.4
17.7
before goodwill amortisation and exceptionals
6
Business overview - Specialties

• Good sustainable growth supported by geographic
  expansion, new product introductions and the
  Sasol Servo acquisition
• Good market demand in key markets
• Sasol Servo acquisition performing well
• Annualised synergistic benefits now expected to
  exceed original estimates by about 40 per cent
• Operating profit impacted by
• Increased innovation spend
• Ongoing ERP performance optimisation costs

7
Business overview - Pigments

• Sales up 7 per cent in US dollars
• Volume and price increases
• Operating profit impacted by
• Raw material and freight cost increases
• Chinese plant start up costs
• TaiCang plant complete
• Commercial production scheduled for H1 05
• Will substantially lower aggregate cost base
• Easton PA plant fully operational
• No long term impact of flooding

8
Chromium
m 2004
2003 Sales 110.5
121.9 Operating (Loss)/Profit (3.8)
6.8
before exceptionals
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Business overview - Chromium

• Sales 110.5 million
• Operating loss 3.8 million
• Prices increases began January 2004
• Sharp freight and energy cost escalation
• Product mix improving
• Market capacity rationalisation progressing
• Further price increases of up to 20 in April

10
Elementis average chromium prices
2001
2002
2003
2000
2004
11
Specialty Rubber
m 2004
2003 Sales 45.9
42.7 Operating Profit 0.2
-
before exceptionals
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Business overview - Specialty Rubber

• 8 per cent Sterling sales increase
• gt20 per cent in US dollars
• Business achieved profitability
• Strong sales growth in all geographic regions
• Geographic expansion in China and Chile
• Strategic options under review

13
Financial summary
2004 m
2003 m
Turnover
389.2 368.2 Before
goodwill amortisation and exceptionals Operating
profit
11.8 24.5 Profit before tax
6.2 18.3 Earnings
per share
1.4p 3.0p After goodwill amortisation and
exceptionals Operating profit
(2.5) 10.9 Profit
before tax
(7.8) 5.5 Earnings per share
(1.8)p 1.0p
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Redeemable B shares
Amount per share Announced Issued (pence)
1.1 Interims 2004 Nov 2004 1.1 Prelims 2004 May
2005
2.2

• 1.1 Interims 2003 Nov 2003
• 1.1 Prelims 2003 May 2004

2.2
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Summary and outlook

• Good progress in 2004 in achievement of strategic
  objectives
• Specialties growth accelerating
• Pigments Chinese plant will transform cost base
• Chromium prices showing significant improvement
• Specialty Rubber top line and profitability
  growing
• Growth in market demand evident
• Costs closely managed
• Prices generally increasing
• Benefits from structural improvements implemented
  in 2004 should become apparent in 2005

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Annual General Meeting
Thursday 28 April 2005