Platform Specialty Products Goes High-Tech

West Palm Beach, Florida-based, Platform Specialty Products Corporation is an international, diversified producer of high-technology specialty chemicals. On October 31, 2013, the Company completed the acquisition of largely all of MacDermid, Inc. a worldwide provider of high value-added specialty chemicals. Subsequently, it changed its name to “Platform Specialty Products Corporation.”

Moreover, after the acquisition of MacDermid, Platform Specialty Products completed the acquisitions of:

  • Percival S.A., including its agrochemical business Agriphar, on October 1, 2014
  • the AgroSolutions business of Chemtura Corporation on November 3, 2014
  • and Arysta LifeScience Limited on February 13, 2015

The Company is also a provider of technical services. Platform’s business involves the formulation of a wide spectrum of solutions-oriented specialty chemicals, sold into multiple industries. These industries include agricultural, animal health, electronics, graphic arts, plating, and offshore oil and gas production and drilling.

The Company’s technology emphasis is on precision formulated chemistry. Essentially, this is the process of blending raw materials (frequently in small amounts) to create special materials. Platform Specialty Products refers to its products as “dynamic chemistries” because of their intricate chemical compositions.

Platform Specialty Products continually looks for opportunities to act as an acquirer and consolidator of specialty chemical businesses on a worldwide basis. It especially looks for those businesses meeting its “Asset-Lite, High-Touch” philosophy.

This corporate philosophy involves prioritizing wide-ranging resources to research and development and highly technical customer service. This is while managing conservatively its investments in fixed assets and capital expenditures (capex).

Regarding its Agricultural Solutions, Platform Specialty Products is concentrating on fast-growing niche crop segments where Arysta can lead with differentiated solutions.  For Q3 2016, the Agricultural Solutions segment reported net sales of $436 million and Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) of $80 million. In China, the Company saw growth in numerous seed treatment and specialty crop production products.

Concerning Performance Solutions, its aim is to become essential to customers’ supply chains with a two-pronged selling approach – OEM (Original Equipment Manufacturer) and applicator level. Platform’s graphics business was up slightly in Q3 2016; it launched new programs with a number of large international accounts.

For Q3 2016, Platform Specialty Products had robust organic growth in sales and comparable earnings. Its organic sales growth came in at 3%. Its Adjusted EBITDA growth – excluding currency impact –  was 13%.

In addition, in Q3, platform had strong free cash flow – a valuation of the amount of cash it produced after accounting for all capital expenditures. Fundamentally, free cash flow is a gauge of a business’s ability to generate the cash flow required to maintain its operations. Platform Specialty Products said that it expects a strong Q4 regarding free cash flow.

For Q3 2016, Platform Specialty Products had strong growth in its electronics businesses from modest market recovery and share gains. The Company had good Asian automotive performance. However, this was somewhat counterbalanced by continued softness in oil and gas markets. Platform had volume increases in most Agriculture regions, including North America, Europe and Asia.

Platform Specialty Products has further improved its full year adjusted EBITDA guidance to a new range of $750 million to $765 million.