Arkema S.A.

Thierry Le Henaff - Chairman & Chief Executive Officer Thierry Lemonnier - Chief Financial Officer

Martin Roediger - Kepler Cheuvreux Jean-Francois Meymandi - Morgan Stanley Tom Wrigglesworth - Citi Peter Clark - Societe Generale Patrick Lambert - Raymond James

Good morning, everyone. So welcome to this presentation of our 2015 Annual Results, and thank you for joining us either here in Paris or on the phone.

Thierry Lemonnier, CFO, will chair this presentation with me. So joining Thierry and me are the members of Arkema’s Executive Committee who are ready to assist in answering any questions you may have at the end of our presentation.

To begin to this presentation, I would like to remind you that in 2016, that 2016 is a special year for the company, as in May, we will celebrate our 10 years anniversary of our spin-off. I am confident that you will recognize that in the past 10 years we have managed to successfully establish Arkema as a strong player in the global chemical industry.

10 years after the spin-off, Arkema is far more profitable and has significantly strengthened its profile with high quality and high value added businesses, a less capital intensive portfolio, a rebalanced geographical presence, and a strong innovation pipeline. The financial performance has improved dramatically with a tripling of EBITDA with an EBITDA margin close to 14% as compared to 6% at the time of the spin-off.

Over this period, and while growing the company, we managed to maintain a solid balance sheet with stable gearing below 40%. We have also demonstrated our commitment to responsible care, with strong occupational safety performance as well as an overall reduction of our environmental impact.

Together with our management team, we strongly believe that the enhancement in the group’s profile, achieved since becoming independent, positions Arkema well for the coming years, and that the evolution in the 10 years to come can be as fruitful. That said, we are keenly aware of the areas where we still need to improve.

The points have been shared with you during our regular meetings together, but we also believe that many ingredients, or seeds of our future success, is already present. In particular, several important growth platforms have been implemented in the recent years.

To outline just a few adhesive technology with Bostik, in our thiochemical business, the new Kerteh site, as well as the development of our sulfur technologies, our technical polymers are increasingly well positioned on lightweight materials and solutions for new energies, specialty coatings have gone through a diversification of their position beyond their traditional end markets. I can assure you that our ambition and our ideas remain focused on delivering further growth in the long term and solid returns to our shareholders.

From this standpoint, 2015 has been a key milestone in Arkema development with a step change, both in the group’s financial performance and profile. So if we move to 2015, which was an important year for Arkema, our employees and management can be proud of our achievements.

The macroeconomic environment in 2015, as you know, was contrasted, offering limited support with higher volatility, slower growth than what we had anticipated at the beginning of last year. In this overall challenging context but with some support from the tailwinds of the fixed rate and the oil price, Arkema overall result significantly exceeded both our initial guidance released in the summer, as well as the end of the EBITDA target range announced last November.

What were the key elements of our 2015 financial performance? A 35% EBITDA increase year-on-year.

At constant perimeter, we still grew EBITDA significantly by 13%. We finished the year well with an EBITDA in the fourth quarter of plus 29% above last year, which was an achievement above our initial expectations.

A successful first year of Bostik inside Arkema that was exceeded expectation and confirms our acquisition relevance. The timing of this acquisition turned out to be a good one.

As planned, the acquisition was accretive in cash flow and in net result. Our cash flow generation was quite favorable frankly, among the strongest ones in the industry.

This translated into a significant decrease of our debt and reduced our gearing down to 35% only a year after acquiring Bostik, the success of the new thiochemical complex in Malaysia which positioned globally the thiochemical business line and which has been both a true technical and commercial success, a promising ramp-up of Arkema’s innovation pipeline, notably in high performance materials and specialty coatings and a strong safety and environmental performance which reflects the full commitment of our employees. Of course, as every year, 2015 had a few lowlights.

Our organic growth in 2015, while in line with most of our peers, was modest compared to our expectations. And acrylic monomers are challenging, notably in China, where the results of our recently-acquired JV were disappointing.

But it is fair to say that this project with Jurong shall be judged on a longer run, and that our coating solutions business segment on the same time has nearly fully offset the downturn of the acrylic monomer, with the strong performance of the downstream business. Another key element to keep in mind when looking at 2017 is the step change in the Group profile.

The face of the company has further developed in the right direction with a better balanced geographical portfolio and a more resilient and better quality portfolio. Europe now represents less than 40% of the group sales, down year-on-year.

We continue to generate more than one-third of our sales in North America which is a solid region to be in. Asia amounts at 24% of Arkema total sales, including 9% in China.

And our exposure to more particularly challenging countries like Russia or Brazil is quite small. Further, the arrival of Bostik has accelerated the development of high performance material, as you could see, bringing us closer to our long-term target of 50% for the HPM segment.

Looking at, finally, looking at our portfolio today, we have three businesses that remain more cyclical in this year than the rest of the portfolio. You have acrylics, fluorogases and PMMA.

Together, they represent now 29% compared to last year where they were representing 38%. And our intent is to limit this share to around 25% midterm, and 20% longer term.

So to summarize, we are becoming far more resilient than in our past. As you know, we have set targets on several external indicators.

They are demanding targets and they are shared and aligned between external and internal communications. Looking at our 2015 performance, we have not only exceeded our EBITDA guidance for the year, but we have also made good progress towards our mid and long-term target.

And this is also true with regard to the cash flow generation, the capital intensity, and the productivity savings goal. And I am confident that this also shows that after a disappointing 2014 which was significantly impacted by external elements, Arkema was quickly back on track, as we told you we would be.

So let’s go now on more detail with 2015, and I will share that with Thierry Lemonnier. I will be brief on the P&L itself, which is shown on slide eight, as it is self-explanatory.

Sales are up 29% year-on-year, with Bostik contribution which is 25%. The EBITDA is €1,057 million which is a meaningful progression both at current and constant scope.

EBITDA margin is close to 14%, which is above last year despite the acrylics cycle, but also despite the fact that the integration of Bostik is dilutive by close to 0.5 points, so this means a very solid performance. And lastly and not least, our net income of €285 million is up 70% on higher EBITDA, and including the financial cost related to Bostik acquisition.

Just note that, obviously, this P&L does not take into account the €33 million coupon related to the hybrid which is booked as a dividend, as you know. Sales breakdown by business.

As you know, we have nine business lines which we believe is an element of stability in the current volatility of the world. Most of these lines have performed rather well in 2015, the only two exceptions being, as you know, the acrylic monomer, but which represent 10% of all sales and not more.

Bostik is now the largest business within Arkema with 20%, and we expect the share of Bostik within Arkema, total Arkema, to gradually increase in the coming years. Coming back to the sales evolution, the main drivers of the sales growth are changes in the scope of the business, with Bostik for the largest part, and also fixed rate thanks to the benefit of the stronger U.S.

dollar. The volumes overall are stable year-on-year, a little bit positive in a slow-growth economic environment.

We have strong areas of growth for example, thiochemicals with the startup of Kerteh. We have also technical polymers.

And we have on the other hand lower volumes in construction in Europe, as you may expect; and also some lower oil and gas volume in certain applications. The price effect reflects both the acrylics cycle and the impact of the evolution of oil derivatives on market pricing in some segments.

One important point in our 2015 result is that quite a significant part of the EBITDA increase versus 2014 was related to internal growth project. The fixed [tailoring] in 2015, which is about €80 million, and the lower energy cost was a positive, even if of course certainly not at the same magnitude as fixed rate.

That, and this is the most important element, the 2015 performance was first and foremost a direct outcome of the project and actions implemented by the Group in the past two years. Let's spend a few minutes on three of these internal drivers.

The first one is thiochemicals in Malaysia. We are proud of this technical success and also the commercial success.

It delivered a contribution which is already close to the objective for the project at full speed. This demonstrates the really strong position in technology in this product line.

The second driver was our innovation effort in six main long-term gross platforms for Arkema. We have added a new one which is linked to the integration of Bostik which is building performance and insulation.

And businesses like our fluoropolymers or Coatex, to name just a few, have benefited nicely from their contribution of R&D pipelines. Let's move now to Bostik, which as I said at the beginning of the presentation, delivered a nice growth, and is in year 1 already accretive in EPS and cash flow.

So as I said, Bostik had a promising start. As you know in this kind of acquisition, the first year is critical because it sets the tone for the future.

You will recall that the acquisition closed in early February of 2015, so we have a series of confirmations since then. First, we had no negative surprises regarding the acquisition itself, which was very important.

Second, we can say that the integration is now mostly behind us. It went smoothly, as expected, in a very positive spirit, and with strong alignment with the Bostik management, both on the strategy and the objectives.

Short-term synergy initiatives are being quickly implemented, and we have seen initial benefits already in 2015 that are in line with our plans. The next step for Bostik is now to demonstrate their ability to grow their top line above the industry average.

In 2015, if we include the most of January which, as you know, was within total, Bostik generated €183 million EBITDA, up 16% year on year. So this is a strong increase given the world economy.

With this performance, Bostik shows that it is well on track to deliver on its strategy and it fully supports our initial expectation regarding the potential of the adhesive line in our portfolio. The Bostik growth strategy is well in place.

It has remained level, as you know, but which are the efficient levels, being better positioned in higher-growth countries, reinforcing the pipeline of innovation thanks to the significant investment in R&D over recent years, and leveraging the global strength of the Bostik range which we believe has super potential. We will monitor closely the progress there, as it can make a significant difference for them.

Given the fragmented nature of the adhesive industry, acquisitions are also, as you know, part of our long-term plan, and depending on the opportunities that may arise, we are prepared to look at some bolt-on targets sooner rather than later. I will now hand it over to Thierry Lemonnier, our CFO, to detail the performance by segment as well as the elements of our cash flow and balance sheet.

Thierry, the floor is yours.

Okay. Thank you, Thierry.

Good morning, everyone and let's start with high performance materials. With sales at €3.4 billion and an EBITDA of €506 million, up by 61% on last year, the performance of this segment first reflects the successful integration of Bostik.

But even excluding Bostik, EBITDA is progressing, supported by the good performance in filtration and absorption, and new developments in technical polymers such as lightweight materials and new energies which compensate the softer demand in more traditional markets such as oil and gas. EBITDA margin stands at the 15.1%, the drop on last year being mostly the consequence of the mechanical dilutive effect of Bostik.

In industrial specialties, all product lines performed very well, and at €418 million, EBITDA is 34% up on last year. Thiochemicals benefited from the strong contribution of our new Malaysian platform, supported by a sustained demand in methionine for animal nutrition.

As expected, in fluorogases, performance started to improve on better prices in certain gases and with the benefit from internal productivity measures, and we are confident that 2016 will confirm this positive trend. Market conditions for PMMA remained favorable all year long, despite some signs of normalization at the end of the year.

Finally, hydrogen peroxide achieved a good year, with promising developments in specialties. EBITDA margin at above 17% is close to historic highs for industrial specialties.

The performance in coating solutions has been affected by the expected low cycle conditions in acrylics and a tougher than expected situation in China where supply adjustments in the context of a lower price of propylene are slower than what we initially anticipated. That said, the lower performance in monomers has been almost completely offset by the solid performance of the downstream businesses which explains the resilience of EBITDA at a level close to the €200 million of last year and an EBITDA margin still above 10%.

This, by the way, fully justifies our downstream integration strategy. Margins in acrylics are now stabilized at a low level.

We don't anticipate the situation to change in the short term. However, we could see some improvements before the end of the year following some capacity shutdowns such as the one recently announced by Dow Chemicals in the U.S.

Let's now look on this next Slide to the cash generation, which is clearly a point of satisfaction for 2015. Free cash flow for the year stands at €442 million.

That is the highest ever for Arkema. And the conversion ratio of EBITDA to cash exceeds 40% for the year.

The more than €400 million additional cash flow in last year is a consequence of three main elements; a higher EBITDA, obviously; lower CapEx and a working capital decrease. The favorable working capital variation is, firstly, the consequence of our permanent efforts to optimize working capital, illustrated by a ratio to sales below 15% as compared to above 16% last year.

And on top of that, we have favorable price effects which exceeds the negative impact of FX on the conversion of U.S. dollar elements.

On this next Slide, you can see the detailed cash flow statement with recurring free cash flow at €478 million. That is more than 2 times last year level.

Net of non-recurring items that are mostly restructuring costs, the free cash flow for the year, excluding M&A operations, stands at €442 million. That is close to 10% of market capitalization.

At €431 million, CapEx in 2015 are significantly down from 2013 and 2014 levels, despite the integration of Bostik and Sunke and the unfavorable impact of ForEx. The ratio of CapEx to sales stands at 5.6% for 2015.

That is close to our target level of 5.5%. For 2016, however, CapEx should be up at €470 million.

That includes the finalization in the second part of the year of two important investments, the first in Honfleur for molecular sieves, and the second in fluorogases in China. Net debt peaked in the third quarter at close to €1.9 billion just after the acquisition of Bostik, and then we generated strong cash flow, including the proceeds of the divestment of Sunclear in the fourth quarter which translated into a significant deleveraging to reach a level of net debt of €1.379 billion at the end of the year.

That is 1.3 times EBITDA. Gearing, excluding hybrid, is at 35%.

A few comments now on the other elements of the balance sheet; the important variation between the end of 2014 and 2015 is obviously the consequence of the Bostik acquisition and its consolidation in the accounts, with the addition of €1.7 billion long term assets and €290 million of provision, out of which €177 million for pensions and other employee benefits. Finally, shareholders' equity stands at €3.9 billion.

That is a progression of more than 10% on the previous year. So that concludes my presentation.

Thank you for your attention, and I will now hand it over to Thierry for the conclusion.

Thank you, Thierry. So as you know, Arkema's dividend is a key element of our shareholder return.

We have proposed to increase our dividend by 2.7% compared to last year based on our quality of 2015 financial results. So this is fully in line with our policy that you know which is to pay a stable-to-growing dividend every year, and it reflects the Board's confidence in the group's cash generation and solid balance sheet.

In terms of payout, it means 45% of the adjusted net income which is in the high end of the range of the industry. Finally, considering the accelerated reduction of net debt, Arkema's Board decided to pay it fully in cash.

You may recall in 2014 we made one exception following the cash outflow for Kerteh and Bostik. So we have looked at 2015, which was very strong, so let's go now to 2016, which is the current year with our priorities.

As you know, our priorities are very clear because we implement a strategy that we started in 2006 and is consistent with 2015 and our longer term plan. And we just focus on a few of the growth elements or important elements of 2016.

As you know, we'll continue to advance our recovery plan which is based on the combination of internal and external actions, and also a better pricing environment. Overall performance in 2015 was in line with our expectation, our growth expectation, which improved with improved market conditions, predominantly in the US.

This year we expect prices to increase somewhat in Europe as well. We'll also continue to work on the competitiveness of our plant, recognizing the ongoing aggressive Chinese competition in the business.

A second key priority will be certainly the further development and consolidation of the successful 2015 in thiochemicals particularly in Malaysia obviously successfully delivering our growth expectation for Bostik for which it will be the second year it's on top of our priorities. And as you know, among some key elements, we have our disposal program that we are going to continue to advance.

We have a total of €500 million of sales to disposal of on three years. We had last year one disposal, which was Sunclear and we will continue to lead this divestment program in 2016 and 2017.

Now if we look at the 2016 outlook. Clearly, with regard to 2016, there are, of course, a number of question marks that you have, that we have on the development of the worldwide macroeconomic environment this year.

So this is shared, I imagine, by everyone in the room and also on the phones this morning. Visibility on the worldwide growth remains limited and volatility on the fixed rate and energy prices remain rather high.

So as usual, we'll expect that no help from the macro, and we'll focus on what we control. This means our own projects, and there are many promising ones.

So I will mention again the benefit from Bostik: higher contribution; from one additional quarter input from thiochemicals in Malaysia; from the further gradual recovery in fluorogases; from our innovation pipeline in technical polymers; and, of course, from our many initiatives in terms of operational excellence which will offset a part of the inflation on fixed cost. Based on these drivers, and assuming an energy environment and fixed rate in line with current levels, we are confident in our ability to grow EBITDA in 2016.

So far, the first two months of the year have started well. We believe if the world remains what it is today that we have the right positioning.

Now last slide key takeaways. To conclude this presentation, I would just like to recall a few points considering Arkema investment case.

The first one is that, again, we have delivered a strong 2015 financial performance in a contrasted environment. Second, we have clearly stepped up our portfolio of businesses.

Third, Bostik has been successfully integrated, and over the coming years should unlock its full growth potential. Fourth, the cash generation was strong with a significant deleveraging.

Fifth, several important projects are well in place to support 2016 performance and beyond. And finally, and probably it is as important to you as the rest, by pursuing implementation of our strategy that you well know, we remain fully committed to further create value in the long run with a strict discipline of cash allocation and a growing dividend policy.

So this concludes my presentation, and together with Thierry and the Executive Committee, we are ready now to answer the question that you may have. Thank you.

Okay. So we will take the first question, either in English or in French.

I have three questions. It's regarding page 17.

It looks that the delta between the impact of portfolio management was just1.2 billion, and then the price cashed out for Bostik of1.6 billion, might be Sunclear. But that would relate to400 million.

But based on a press release, the EV of Sunclear was105 million. Can you help me to reconcile what is additionally in that position impact of portfolio management?

That would be my first question. The second question is on the adjusted EPS.

You said this excludes the unrealized foreign exchange results on financing in foreign currencies on non-recurring investments. Can you help me?

What do you mean by that? And finally, can you help me to understand what was the FX related EBITDA effect in Q4?

And what do you expect to be the case in 2016 on EBITDA, assuming that FX rates stay where they are right now, but you still benefit from your hedging you had done in the past? Thanks.

Okay. I assume these questions are more for Thierry, so Thierry will answer.

Martin, it is. I will take the two first points.

On the cash outflow for Bostik, we have to make a difference between the price that we have paid for the shares of the company that we purchased from Total, and the refinancing of internal loan that we have to pay to Total, and this second amount does not appear in the second part of our cash flow statement but in the third part as an increase of the debt. So the cash outflow for Bostik has been €1.6 billion.

€1.2 billion is related to the purchase of shares and €400 million to an additional debt through the refinancing of internal loan at Total level. But at the end, Total has received the full amount.

That is €1.6 billion. For the ForEx element that you are mentioning in our non-recurring result, in fact, at the end of year, it’s no more an issue since we have changed the functional currency of our Malaysian operations due to the high volatility of the ringgit and due to the fact that the functional currency of our activities in Malaysia is the dollar.

So we have neutralized the ForEx losses that we have booked during the third, the three first quarters during the fourth, which explain the positive amount of financial costs that we have in the fourth quarter. But at the end of the year, all those elements are neutralized, which means that it has no impact on our results.

The third one, maybe I miss. The impact of the FX effect on our EBITDA is, as you know, €80 million for the full year, which means that for the fourth quarter it was at around €10 million.

And to answer your last question, in 2016, we assume that the fixed rate stay what it is, which should be neutral on the year.

Okay. Thank you.

Thank you, Martin. Any other question [indiscernible].

Can you hear me?

Yes.

Good stuff. Thank you very much.

I wanted to spend a bit of time on your 2016 and 2017 progression. It looks like you reaffirm your 1.3 billion EBITDA for 2017, yet you assume no help from the macro in 2016.

And therefore, I wanted to discuss a bit in detail what is bringing you to the 1.3 billion in ’17 within your portfolio. Is it a clear step-up in acrylics or do you have anything else that we should know?

And then in 2016, you speak on your guidance about some items. Can we speak about the downstream acrylic parts in 2016, how do you see that developing?

And finally, I would like to speak about fluorogases on the 1234yf. Looks like you’re going to commit a certain amount of capital this year to this activity.

How advanced are you in your discussions with the European Commission there to see if you can operate this plant beginning of 2017? Thank you very much.

Okay. So with regard to 2017, so we are very clear.

I think we confirm everything we have said during the Investor Day. So it was not the purpose now because it’s the annual result 2015, but we confirm the roadmap which has been defined during the Investor Day for where you have the €1.3 billion of EBITDA target, and the assumption the way we have built this target.

So to answer your question precisely, you have three columns with three different elements. Some are purely internal like, for example, the progression of Bostik and the development of the thiochemicals in Kerteh.

You have an assumption that between the small organic growth, the operational excellence and the inflation, you have a sort of neutral contribution. Then you have the M&A where we say because we have not exercised a second option, the option for Sunke for the second line.

We say this will free some capital and we could replace what we wanted to do in terms of EBITDA contribution with Sunke by why not a small sum, small to mid-size acquisition in adhesives which is more downstream. And then you have the pure effect of environment where we see, as we mentioned, it's rather neutral in 2016; at least it is our assumption at the beginning of the year.

And where in 2017 you have some elements which compared to 2014, some with regard to acrylics, which is, as you know, an important element, but also some with regard to MMA/PMMA. So acrylics we [indiscernible] MMA/PMMA we are a bit above.

Then you have the fixed rate where we are fully in line. So you have, if you look at the roadmap, about 12/14 major elements.

They are very clear. I think you can follow them, have your judgment, and you can use it to define where we think we should be.

So we are really very clear on this roadmap and we still believe it's possible.

And do you think you can close half of the gap between your target and your 2015 EBITDA in 2016, or it's going to be a non-linear progression?

So I think for the guidance on 2016, the EBITDA, at the beginning of the year we gave qualitative guidance where we said two things. First, we are confident on growing the EBITDA in 2016, which I think in the current world is a positive element.

And secondly, we give you the elements which at the end would make the most significant difference with a few projects that you know. So I think we are very clear on that.

And beyond that, I would like to remind you that we started the plan with a base of 2014 where we started at €784 million. We are already at €1,057 million.

I consider that we are progressing well up until 2017. So I think we give a lot of elements I think in terms of guidance, in terms of where we build our plan.

I think if you look at the roadmap, I'm not sure how you get so many elements from everywhere. So I think we are progressing well.

We still confirm them and we give you the assumption to build it. And with regard to 2016, I think looking at what we publish in our chapter 2016 outlook, I think we are rather clear, even if you recognize we are -- as usual, at the beginning of the year, we are more qualitative than quantitative for the current year.

That's clear.

Now with regard to the downstream acrylics in 2016, I think we'll continue to benefit from our innovation honestly. It's clear that you have to look at the coating solutions segment as a whole, with an upstream and a downstream.

With regard to the upstream, as we say, we think that a good part of the year -- first of all, the acrylics margins are stable now, which is a good thing. Secondly, we believe that for the major part of the year, we should stay more or less at this level, but we still think that we should start to see some improvement at the end of the year.

With regard to the downstream, which is more your question, which has performed rather well in 2015, we believe that it will depend on the worldwide economy, but at the same time, we have some good projects on 2016. It's clear that because we have an integrated upstream downstream, while having the acrylics, acid, more stable in 2016, you don't have this benefit of integration that you had in 2015.

But this business is quite resilient, I would say, for the downstream. With regards to the 1234yf, as usual, I will not change my answer to this question, which is often asked.

It's normal. Just to tell you that the site is progressing as planned so it should start to be accomplished this year.

And with regard to the commission, which is, as you know, a very formal development, we prefer to leave the commission communicating when it is the right time. For the time being, the process is advancing, but we cannot say more at that time except saying that we are confident at this stage of a very strong early goal background.

Two questions if I may, first with regards to the kind of the aggregate volumes that you've highlighted driving sales…

Tom, can you speak a little bit more slowly, because the line is not very good. Will you like wait and say, we need to have the accurate questions in terms of, so.

My first question is with regards to the volume growth. Do you think that there was no volume growth in your end markets in 2015, or do you think your volumes are impacted by destocking in 2015?

And my second question, if I may, is obviously one of your competitors is out saying that things are going to be tough in MMA in 2016. You talk about a softening in the markets.

Where do you see the market in terms of the cycle? Are we still at mid cycle, or are we close to trough in the MMA/PMMA balance?

And can you talk us through, given your integration there, how that market development plays out for you in 2016?

So with regard to the first question on the volume growth, I think the end markets are growing a little bit. It's a mix.

You know we are very diversified on the end markets. You have some which are negative, like construction in Europe.

It was the case in 2015 which was challenging, especially if you take the example of France, we know it was negative. If you take oil and gas it was negative.

But on the other side, as end market we have also sport. We have automotive.

We have electronics. We have -- which has been a positive.

So overall, I would say our markets are growing like the GDP. After that, it's sure that last year, because of the volatility of the raw materials, as a sudden decrease of raw materials all along the year, our customers are by definition cautious in their stock management.

And we believe that there has been a destocking sometime in the year last year, and because of that we were more slightly positive in volumes, that above that. But we don't think -- we think we have maintained our share so we reflect the market.

And compared to our peers, we believe that we are in the right average. With regard to the MMA/PMMA, as you know, we don't comment what other companies are saying.

What we can just say that, as we said in '15, it has been a favorable condition, but also for good reasons. I think you are talking about the end market.

Automotive has been very good in terms of growth worldwide in 2015 and we still continue to see a good momentum hearing what automotive companies are saying. For example, it is the case in Europe.

And also, we benefit from the growth in LED market, which is good. On the other side, there has been some technical issue in certain plants along the year.

So we say that this MMA/PMMA market could suffer a little bit in 2016. We'll see all along the year what it is.

But for the time being it is a favorable condition, but as we say, we are still a bit cautious on that; but not more than that.

Just two again, first of all, on the established high performance materials businesses, they ended the year quite strongly, excluding obviously Bostik, but it was against a soft comp, I think, on the fourth quarter. I think the EBITDA on my numbers was up something like 10% year-on-year.

You've pointed that some of the business potentially tougher in 2016. The molecular sieves, I think, you're pointing at that potentially being down.

And then you said about the technical polymers, helped by pipeline, etc. Just wondering how you see that established HPM business this year.

Perhaps technical polymer is up, I don't know, and the additives side down. And then the second question on the acrylics, just clarifying what you've been saying on acrylics.

I get the feeling you feel the Asian acrylic, even upstream, really can't get too much worse than it is at the moment. It might not recover, but given the situation of a lot of loss makers out there, your feel is that it probably can't get too much worse.

So I just want to clarify that.

Yes, Peter. I think, with regard to HPM, first of all, 2000 -- what you don't say, and I think hopefully you will recognize, is that 2015 has been quite a good year, even excluding Bostik.

And I think the world, as you know, is slow growth, but I think thanks to our innovation we are progressing. With regards to 2016, as you know, we are very transparent.

We say that we have one specific point is that in a period of many years, molecular sieves will be a bit down but it's not a negative point. It's just a calendar of projects for 2016.

We know and we said that already many months ago so nothing new on that. For the rest, we continue to benefit from our innovation work in lightweight materials, in solutions for sustained development.

We have very good lines, very good share. And 2016 should be quite a decent year.

We'll see at the end of the year to which level. I think we are still at the early stage of the year.

But with including Bostik, or excluding Bostik, I think we have many elements which will contribute on next year. So I don't share your negative view of HPM next year.

I think they have demonstrated in 2015 that we had quite a good position. And we'll continue to do that, even in a world which is challenging, as everybody knows.

But there is only one point to be noticed, which is, as I mentioned, this calendar of projects which go into molecular sieves, which next, this year in 2016 will be weaker than what it has been, but will start again to be quite strong in 2017, 2018, 2019, 2020. With regard to acrylics, I confirm what I say.

We have reached bottom, we consider, and we don't say that this bottom will increase in 2016. We say that for the large part of 2016, we should stay more or less where we are now, but we hope to see some improvement at the end of 2016.

So certainly, not decrease, but maybe some increase at the end of the year, but we'll see. But a positive point is that we have seen stabilization now since a certain number of months.

And also, you could notice that we have the announcement by Dow that they will close some capacities in the U.S., which is certainly not a bad announcement for the market itself.

A few questions. The first one, thiochemicals, more into 2015 performance, I think I've read in your comments that you are, you think you're very close to full capacity.

I was wondering. Is it on the methyl mercaptan for the methionine plant where you're almost at full capacity, and there's still upside from the other products?

Or is the whole platform already running at rates very close to full utilization? That's my first question.

Second question, again, going through the different business units, fluorogases, it seems, at least in my numbers on industrial specialty prices, would have been down in Q4 while they were up in the first nine months, mostly, I would assume, from fluorogases. Could you comment a bit on the trends on prices in Q4 in gases?

Were they actually in line and it's mostly PMMA/MMA that drove down the prices in Q4? And what do you expect in 2016, especially in Europe, in terms of price developments?

Third question on acrylics, could you guide us a bit on when the 12 conditions in 2015, if I remember correctly, in 2009, margins were about 8%/9% EBITDA margin in U.S. and in Europe, is that still a good assumption for the 12 conditions in the Northern Hemisphere, and zero in China?

Is that the right way of thinking about it? And I guess the last question, sorry, Bostik.

Could you give us the organic growth of Bostik in 2015? Thanks.

Okay. So very precise questions, I will start with as usual with you Patrick.

So I will start with the thiochemicals. Thiochemicals, as you know, we have two end markets.

One is linked to animal nutrition and the other one is more refinery and petrochemicals. It's clear that in terms of ramp up, because the methionine market is going pretty well, we are giving the priority to methionine.

And we have still some capacity for the other businesses in our other plants in the world. So what has happened is that, clearly, we have ramped up very quickly in terms of capacity for the animal nutrition, and we can arbitrate between animal nutrition and the other businesses because we know that we have the capacity in the other plants of the world.

So the answer to your question is that, yes, we are especially compared to our initial plant close to full capacity, but these kind of plants, if I look longer term, are there to be developed. We are not going to stay just with this size.

And short term, yes, we are close to full capacity. This means that we have accomplished in one year at a pace which is not very far from what we thought we would accomplish in three years.

But, again, our team are working; will try to find again ways to develop. But we have also, as I mentioned, some capacity available and we'll be able to catch growth again in other plants and we'll be able to catch growth.

But it's clear that Malaysia in 2016 was more -- mainly animal nutrition [school] than the other businesses, which are more -- which are developing but which is a more smoother development. With regard to fluorogases, no.

I think we have to be careful on the mix which is very conscientious between fluorogases from quarter to quarter, from year to year. So we should take the year as a whole and don't try to extrapolate.

Clearly, what we had last year in fluorogases is some improvement of prices, as expected in the US. And to make the link with your second question, in Europe, we expect the pricing to start to improve this year, and there is certainly no down trend, significant down trends.

You have so many products that you have always a product which is getting down. But overall, I would say the trends are positive, both in the US and in Europe.

I would say US started to get gradual improvement in 2015; it should continue to 2016. While in Europe, it's more starting in 2016.

With about the same impact, do you think, in terms of prices?

Sorry. Say it again.

With about the same impact in terms of prices as a percentage?

You cannot compare Europe and US, because US, it's only a few grades, where Europe, it's more the whole [indiscernible] so it's difficult to compare, at the end of the day I think if you take a long period we should have a rather comparable impact between Europe and US, but it's not the same timing, and these are not necessarily the same products. Okay?

Okay.

So now on acrylics, we have given our guidance and we don't change it with acrylic, acid and esters, which is between 10% and 20% EBITDA, between price and high cycles, which were true for Europe and US since for now, we have the position only Europe and US. So 10% trough, 20% high cycle, acrylic, acid, Europe and US.

So we have not changed the guidance. And with regard to China, we said when we made the acquisition that we think that the average would be the same, around 15% in mid-cycle, but the magnitude would be larger, between 5% and 25%.

And in fact, what has happened in 2015, which has surprised us, which was we were around 0% in China in 2015, so it has been a surprise, but again, I think these are absolutely exceptional conditions which are temporary. And second thing, we still believe that in mid-cycle, China can deliver 15%.

And we'd like also to remind everybody that our site in China that we have bought, or at least our line, is very, very competitive, and in normal conditions would be certainly quite profitable. With regard to Bostik where we have given, I hope you have appreciated, a lot of information, and because we have accepted for the first time to give on one business line our EBITDA, while we give it now normally by business segment, so we'll not give all details for everything.

I would say that organic growth -- anyway to answer your question, organic growth has still been moderate in 2015; below the industry or let's say the best peers in the industry. We know it was a challenge when we made this acquisition.

We are confident that step by step we'll join, in terms of organic growth the best peers which they are delivering in terms of organic growth GDP plus 0.5% to 1%. We are not there.

We are still a way to go. But we believe that there are the ingredients in terms of R&D pipeline, in terms of market positioning, in terms of potential of the brand to join the club in terms of organic growth of the best peers.

But we are not there. We knew it was one of the challenges when we bought Bostik.

On the other side, they are very strong in operational excellence. I think the synergies with Arkema are going well and we are fully delivering our three-year plan.

But when we defined this plant, we always said that with regard to organic growth it would take more time than the rest, so we are there.

Just a quick follow-up. Have you seen any sign of European and French construction picking up versus last year, early signs?

We are cautious.

Okay. Thank you.

We’ll give you the signs when they are there, not before.

Understood.

I appreciate it.

Some question is in room or I think the press release was very clear, so this is when. Okay.

So thank you very much for your questions. Thank you for your support and talk to you next time.

Thank you.