ARKEMA : Third Quarter 2015 results

Colombes, 10 November 2015

Arkema: quarterly information - 3rdquarter 2015 results

• €1,946 million sales, +32% up on 3Q 2014 including Bostik contribution of +28%

• Strong EBITDA increase to €286 million, +38% up on 3Q 2014 (€207 million)

  • Excluding Bostik contribution, significant improvement driven by Industrial Specialties

  • Good performance of Bostik strengthened by first benefits from synergies

• EBITDA margin increase to 14.7% (14.0% in 3Q 2014) despite Bostik dilutive effect

• Adjusted net income1of €95 million up +36% on 3Q 2014, i.e. €1.27 per share

• Very strong cash flow generation and decrease in net debt compared to end June 2015 at

€1,632 million, i.e. 42% gearing

The Board of Directors of Arkema met on 9 November 2015 to review the Group's consolidated accounts for 3rdquarter 2015. At the end of the meeting, Thierry Le Hénaff, Chairman and CEO, stated:

'Arkema achieved a strong performance with good cash flow generation in a third quarter marked by volatility in petrochemical raw materials and a soft global economic environment. Excluding Bostik contribution, EBITDA improved significantly, with the vast majority of product lines progressing over last year. Among major projects, Bostik confirmed the solid momentum of the first half, and began to benefit from first synergies. The thiochemicals site in Kerteh in Malaysia delivered an excellent quarter, whereas the performance of our new acrylics activities in China remained disappointing. While we remain cautious about the economic environment, we have increased our EBITDA guidance for 2015 released with the half-yearly results.'

1Adjusted net income now excludes unrealized foreign exchange results on the financing in foreign currencies of non-

1/6

recurring investments (Thiochemicals in Malaysia).

ARKEMA

420, rue d'Estienne d'Orves - F-92705 COLOMBES Cedex - France Standard : +33 (0)1 49 00 80 80 - Fax : +33 (0)1 49 00 83 96

Société anonyme au capital de 743 607 230 euros - 445 074 685 RCS

High Performance Materials Industrial Specialties Coating Solutions

19.4%

14.9%

10.4%

15.1%

18.8%

11.4%

Recurring operating income 120 176 +46.7%

Non-recurring items (43) (15) n.a.

Net income - Groupshare24 61 +154.2%

Adjusted net income per share (2)(3)(in€)1.06 1.27 +19.8%

(1)3rdquarter 2014 figures have been restated to reflect the new reporting structure presented at the Capital Markets Day held on 29 June 2015 and in accordance with the IFRIC 21 standard 'Levies'.

(2)Adjusted net income now excludes unrealized foreign exchange results on the financing in foreign currencies of non- recurring investments (Thiochemicals in Malaysia).

(3)For 3rdquarter 2014, the adjusted net income per share was adjusted to take account of the share capital increase with preferential subscription rights finalized in December 2014.

In 3rdquarter 2015, Group sales reached €1,946 million, 31.7% up on 3rdquarter 2014 with a

+29.4% scope effect related to the acquisition of Bostik and the purchase of a stake in Sunke in Acrylics in China. The currency effect was positive at +7.0% mostly due to the strengthening of the US dollar versus the euro. Volumes, close to last year's (-0.5%), reflected overall soft global demand. The trend in prices (-4.3%) was essentially due to the acrylics cycle.

EBITDA, at €286 million, was, for the third quarter in a row, significantly up (+38.2%) over last year. The integration of Bostik, the ramp-up of the new Thiochemicals plant in Malaysia, a positive currency exchange effect (translation) of some €20 million, lower input costs and a good control of fixed costs contributed in particular to this solid growth. EBITDA margin rose to 14.7% (against 14.0% in 3rdquarter 2014) despite the acrylics cycle and the mechanically dilutive effect of Bostik's integration.

In line with EBITDA growth, recurring operating income grew to €176 million against €120 million in 3rdquarter 2014. It includes €110 million depreciation and amortization, up on last year (€87 million) as a result of the acquisition of Bostik, the purchase of a stake in Sunke, the impact of currencies, and the start-up of new production plants.

Non-recurring items amounted to -€15 million, including -€10 million corresponding to additional depreciation and amortization booked as a result of the revaluation of tangible and intangible fixed assets as part of Bostik purchase price allocation. The other non-recurring items mostly correspond to restructuring expenses.

Financial result stood at -€53 million against -€15 million in 3rdquarter 2014 as a result of the higher cost of debt relating to the financing of Bostik acquisition as well as the recognition, following a sharp fall in the

Malaysian ringgit versus the US dollar, of a €28 million unrealized currency loss on the financing in US dollars of the investments made in Thiochemicals in Malaysia. This last item had no impact on net debt.

Income taxes amounted to -€51 million against -€37 million in 3rdquarter 2014. Excluding the reversal of

€3 million provisions for deferred tax liabilities recognized as part of Bostik purchase price allocation, tax rate stood at 30.7% of the recurring operating income, reflecting the geographical split of the results, and in particular the share of the Group's income generated in the United States.

Net income Group share stood at €61 million against €24 million in 3rdquarter 2014. Adjusted net income stood at €95 million, i.e. €1.27 per share.

High Performance Materials sales reached €866 million, +100.5% up on 3rdquarter 2014, largely supported by the contribution of Bostik (€411 million sales) and a +6.8% translation effect. The -1.9% decrease in volumes reflects weaker demand in some applications in the oil and gas market. The price effect was stable overall (+0.2%).

EBITDA grew by +56% to €131 million against €84 million in 3rdquarter 2014. This strong increase is the result of Bostik's good performance in a moderate growth environment, thus confirming the relevance of its strategy and the benefits from first synergies. Excluding Bostik contribution, the segment's performance is at last year level, lower volumes being offset by the positive impact of currencies and lower input costs.

EBITDA margin stood at 15.1% reflecting the mechanical dilutive effect of Bostik integration.

Industrial Specialties sales rose by 10.1% to €608 million against €552 million in 3rdquarter 2014. This growth results from a +7.8% translation effect as well as a +3.2% increase in volumes supported by the ramp-up of the new Thiochemicals plant in Malaysia. These effects largely offset price variations (-1.3%) mainly resulting from product mix over the quarter and lower raw materials.

Up 39% compared to 3rdquarter 2014, EBITDA reached €114 million, showing a strong improvement for the third quarter in a row. The excellent performance of Thiochemicals reflects the contribution of the Kerteh platform (Malaysia) which continued to enjoy strong demand in the animal feed market in Asia. PMMA results remained very good with a few signs of normalization. Certain fluorogases continued to enjoy higher prices than last year in a quarter with a traditionally less favorable seasonality. Finally, Hydrogen Peroxide again reported a solid performance, significantly up on last year.

EBITDA margin showed also a solid improvement compared to 3rdquarter 2014, at 18.8%.

Coating Solutions sales stood at €465 million, -4.9% down on last year. The translation effect was positive at +6.5%, and the acquisition of a stake in Sunke resulted in a +4.1% scope effect. A -3.6% decrease in volumes reflects ongoing soft demand in construction and decorative paints in Europe as well as inventory adjustments at the end of the quarter in a context of high volatility of raw material costs. In line with the beginning of the year, the -11.8% drop in prices reflects the acrylics cycle and lower raw material costs.

EBITDA stood at €53 million against €51 million in 3rdquarter 2014, while EBITDA margin reached 11.4%. The positive impact of currencies and the good performance of downstream activities supported by new developments at Coatex as well as lower costs helped offset lower margins in acrylic monomers. In this activity, unit margins were at low-cycle levels, particularly in Asia, and should remain so in the near future.

In 3rdquarter 2015, Arkema generated +€172 million free cash flow2, significantly up on 3rdquarter 2014 (+€64 million). In line with the Group's ambition reaffirmed at the Capital Markets Day in June 2015 to increase cash flow generation, this good performance reflects a strong EBITDA growth compared to last year and the good control of working capital and capital expenditures. Over 3rdquarter, working capital decreased by €43 million 3reflecting the traditional seasonality of the activity and capital expenditure amounted to

€103 million. Non-recurring items over the period were limited to -€3 million.

After taking account of the impact of portfolio management operations, net cash flow 4stood at

+€167 million in 3rdquarter 2015 against +€63 million in 3rdquarter 2014.

As regards Group capital expenditures (including Bostik), Arkema maintains its forecast for 2015 which, adjusted for the impact of exchange rate variations (mostly US dollar versus euro), should represent some

€470 million.

Net debt stood at €1,632 million at 30 September 2015 (against €154 million at 31 December 2014), i.e. 42% gearing. It is down compared to end June 2015 (€1,773 million). It includes €47 million dividend paid in cash in 3rdquarter to shareholders who did not elect for the payment in shares. It does not include the

€33 million interest due on the hybrid to be cashed out in 4thquarter 2015.

In line with its ambition to expand in high-growth regions, Bostik increased its production capacities in Bangalore, India. This new hotmelt pressure sensitive adhesives (HMPSA) production plant will enhance Bostik ability to serve its global customers in the disposable hygiene market.

The multi-currency credit agreement for a maximum amount of €900 million signed in October 2014 for an initial 5-year term was extended for a further 12 months.

The 4thquarter 2015 should reflect the usual year-end seasonality, which might be amplified by current volatility of raw material prices and result in a more cautious behaviour from some customers towards the end of the year. The impact of the US dollar / euro exchange rate should remain positive, but far less material in the fourth quarter than in previous quarters. Unit margins in acrylic monomers are expected to remain at low- cycle levels, in particular in Asia.

At the end of the year, Arkema will continue to benefit from Bostik's contribution and the ramp-up of the Thiochemicals platform in Malaysia, as well as its operational excellence efforts to offset part of the inflation on fixed costs. The improvement in the fluorogas activity should be limited in the quarter given the traditional year-end seasonality of this business.

Based on these drivers and the strong performance of the first nine months of the year, Arkema increases its EBITDA target (including Bostik contribution) for 2015 up to a range of €1,020 million to €1,040 million (Arkema had announced late July an EBITDA target for 2015 'slightly above €1 billion').

2Cashflowfromoperationsandinvestmentsexcludingtheimpactofportfoliomanagementandtheunrealizedforeignexchangeresultonthefinancing in US dollar of the investments made in Malaysia (-€28 million in 3rdquarter 2015) which has no impact on net debt.

3Variation excluding non-recurring items.

4Cash flow excluding the unrealizedforeignexchangeresultonthefinancing in US dollar of the investments made in Malaysia with no impact on net debt.