Ashland Inc. Investor Day 2026

Hello, everyone, and welcome to Ashland Innovation Day 2026. My name is Sandy Klugman, and I am Ashland's Director of Investor Relations. Today, you will hear from leaders across Ashland, including business executives and technology experts who will discuss how our innovation pipeline is creating differentiated commercial opportunities that drive long-term growth and value creation. Please note that we will be referencing slides during today's webinar. We encourage you to follow along with the webcast material available at ashland.com under Investor Relations. As a reminder, I wanted to caution listeners that during this call, the company's management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the company's business.

These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's investor presentation and Ashland's SEC filings, including the quarterly report on Form 10-Q. Please review the safe harbor statements and the disclosure regarding our use of non-GAAP financial measures included in those materials. With that, I will turn it over to Guillermo Novo, Ashland Chair and CEO.

Welcome, everyone. It is a pleasure to be here today. Welcome to our third Innovation Day update. It is a pleasure to host you today. As you have heard in prior events, Ashland has made innovation a strategic priority to drive differentiation and value creation for the company. Today, we are here to give you an update on the progress that we have made, as we have promised in the last updates that we gave you. Before I go into the specifics, you are going to hear from our businesses and the teams that are actually doing a lot of the work. I did want to give a quick recap of the technologies and the things that we have said in the prior events. One, we have made significant progress in advancing our technologies.

Significant, tangible progress around validating our technologies, developing new products with our customers, and very importantly, advancing our regulatory and manufacturing capabilities to enable these new technologies. The customer collaboration has been very strong. We have brought in a very robust value proposition for our customers that they have been very excited about, and more importantly, that they have engaged us in collaboration to develop these new technologies into the specific markets that they are interested in. Now we are in the commercialization phase of the process. We are really in the thick of launching products, broad-based products that will cross multiple customers and markets, but also advancing specific product developments with some of our customers to develop the products they need for specific launches that they have. Very exciting time for us.

But equally important, we validated that these are very scalable opportunities, that for a company of our size, it can change our future, our prospects for growth, profitability. We validated these technologies. We are targeting sizable market opportunities, and you are going to hear about that today. But also, we also validated that the value propositions that we are bringing to our customers is things that they really need. More importantly, we have done a lot of this work internally as we started the work, but more recently, we did conduct a third-party evaluation of both those things. Are we targeting large markets, big market opportunities, and what do our customers, what does the industry think about some of these technologies? The third-party company, reputable company that has done this for many other players in the industry, came back with two messages.

One, yes, the opportunities are very large, actually a little bit larger than you guys think. So you will see some numbers changing in terms of the value opportunity. But more importantly, for me, I think the interviews that they had with our customers and with industry experts also validated that if these technologies are working the way that the data shows, that they are addressing important value propositions and do meet the needs, the requirements that the industry is looking for. So very exciting progress on multiple fronts. When we look at our strategy, it is very clear and effective for us at this point in time. Execute, globalize, innovate, invest. We have done and we finished all of the portfolio transformations, the changes in the company. We have the company now to where we have it. So it is really about executing the strategy. Execute, simply put, is about being competitive.

It is a very competitive world. You need to be cost competitive. You need to have reliable supply, productivity, and that is what we are investing in strengthening our ability to compete in some of our core businesses. Globalize is about global share gain. We have four high-quality businesses that we want to grow. These are two in pharma, our tablet coatings and our injectables business, and two in Personal Care, our microbial protection and our biofunctional actives. How are we going to globalize them? We are globalizing them by regionalizing them. We are putting a lot more resources in each region to commercial resources, technical resource, and more importantly now, supply resource, supply capabilities so that we are more local. We can innovate, collaborate with our customers locally, but we can also supply them. As you have seen over the last two years, we have been reporting the progress.

These four businesses have been generating very good growth and results in our business. The third is innovate. This is what we are here today. The whole purpose of that is to rejuvenate our portfolio to bring differentiation and value creation opportunities to the company. You are going to hear more about that as we move forward. Last, it is about invest. It is about capital allocation discipline. We want to make sure that we are investing in the right projects. Specifically for us, it is about driving organic growth. It is about increasing our profitability and generating free cash flow. How do we do that? Looking at the organic growth areas that we want to invest, productivity areas, and bolt-on M&A opportunities that can augment the business strategies of each of the respective businesses, with pharma obviously being a big area of focus for us. Our business model is very simple now.

It's very clear. We're about additives and ingredients. These are products that are low cost and use high value and use for our customers. They're critical ingredients in their formulations, so that allows us for a lot of differentiation and value creation potential for our customers. We build competitive advantage by leveraging these scalable technologies around of selling them into some of these core markets where we have leadership positions. Today, pharma, Personal Care, and coatings are these leadership positions. Not only the older, old technologies that we have, core technologies, but all these new technologies. The more we intersect with bringing these technologies to those markets, they build competitive advantage for us, but they also allow us to grow faster. We do have secondary markets where we do sell to create scale.

The objective strategically would be, over time, can we get enough of those intersection to build a fourth or fifth business that we can build that level of strategic leadership position. We're talking about a lot of new technologies that we're trying to launch, and that means that we're replacing incumbent technologies. That's a difficult process to do. Incumbent technologies have well-built asset bases, the infrastructure to support them. These things are new technologies. For us, we feel that there's four things that you need to bring to the market, to our customers, to be successful with these new technologies. First, it's about performance, superiority. The product needs to be better than the incumbent technology. Equal to or better. It cannot be, it's great, it's sustainable, but it doesn't work. Customers are not going to buy products that don't work.

Superiority is critical to their value proposition, so for us to be successful, we need to bring that to them. Second is cost. The economics of the new technology need to fit the long-term needs of our customers. Obviously, some of these are new technologies, so it's not just about the starting cost, it's can you build the economies of scale to bring the cost of these technologies down? And we believe we can do that. Third is sustainability. Sustainability is real. It's important to our customers in all industries. Personal Care, obviously, is more attuned to this than other industries, but we see it in industrial applications, coatings, all customers are very interested. The issue is not just bringing sustainability. Is the sustainability you're bringing significant enough? Is it relevant to what they're doing? And we think we have a very strong value proposition.

Lastly, but very importantly, the value propositions that we bring to our customers have to meet their strategic needs overall. If we don't meet this, they're not going to collaborate. For them to collaborate on these kinds of initiatives, it has to be important to them and it has to be important to us. Getting those mutual intersections of strategic fit are very important. And that's why we're excited, because we feel a lot of our technologies are actually hitting all four of these areas, and that's, I think, why we're making very good progress in advancing them. Today, we have made a lot of progress. I hope you're going to see very different updates from the prior events that we've had. We started just a few years ago. We were in the ideation.

We just passed ideation, where we were talking about a few new technologies or applications. Now you are going to see a plethora of applications, products, markets. It is really evolved in multiple directions. We have validated these technologies work. It is not just our validated, our customers are telling us that. We have also now validated the products that we are developing for them are meeting their needs. So now it is an advancement to the commercialization. Great progress on the regulatory manufacturing front, which was one of the key drivers of the timetable for our innovation. So great progress, especially, I would say, in the regulatory area, which was a key issue. Now we are in the exciting commercialization phase. So the next year, 2 years, it is going to be about making sure that we are commercializing, creating, going from potential to real value in these technologies.

But before we hear from our businesses and specifics, I have invited here today my partner here, our CTO, Dr. Osama Musa. He has been obviously a critical driver here of these initiatives. I wanted to have a quick fireside chat just to talk a little bit about the broader things before we get into the specifics with each of the businesses. So Osama, what I wanted to do is 3 questions that I will place, and we will have a few slides for you to talk to. But one, we have focused on innovation a lot in the change in the portfolio, new techno, all the exciting things. But what I am seeing is it is changing us.