Melamine: Building Block Building Block Building Block Building Block Chemicals Chemicals Chemicals Chemicals

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Building Block

Chemicals

Melamine

Cytec Industries Inc


Building Block Chemicals
Building Block
Chemicals The Cytec Profile
Sales by Segment 2006 Sales by Geographic Region
Sales $3.1B*
Cytec Surface Specialties
North America

49%
38%
Building Block Chemicals Asia
9% 14%
Cytec Specialty
Chemicals 6%
20% Latin America
22% 42%
Cytec Engineered Materials Europe
Cytec Performance Chemicals*

5
3.80
3.60
3.45
4 3.03 3.07

Diluted Earnings Per Share**


3 2.27

0
2003 2004 2005 2006 2007E
* Excludes sales of divested water treatment chemicals product lines
** See appendix for reconciliation of Non-GAAP to GAAP EPS 2
Building Block Cytec’s Growth Strategy
Chemicals

Focus on Technology
Grow With New Product
GDP Growth Introductions and Existing Geographic Expansion
Growth With Market Products For New Applications Grow In Areas Such As:
Asia, Latin America
TOP LINE

Targeting 5-7% Top-Line Growth


&
Double-Digit EPS Growth

BOTTOM LINE

Bolt-On Acquisitions Operational Excellence


Continue to Enhance productivity

Focus On Creating Sustainable Technology Franchises


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Building Block Cytec Performance Chemicals Profile
Chemicals

2006 sales M$678* By Region (% of Sales)


Product Portfolio (% of Sales)
Pressure Sensitive Adhesive
Asia
Latin America
14% 15%
15%
Phosphine Chemicals
Mining Chemicals 7%

31%

20%
37% 33%

Polymer Additives
10% 18%
Urethanes North America Europe
Specialty Additives

2006 operating margin 7.9%

 #1ininspecialty
#1 specialtymining
miningchemicals
chemicalsfor
forcopper
copperand
andalumina
aluminaprocessing
processing

 #1high
#1 highpurity
purityphosphine
phosphineand
andderivative
derivativechemicals
chemicals

 AAleading
leadingglobal
globalsupplier
supplierofofpolymer
polymeradditives
additiveslight
lightstabilizers
stabilizers

 Nichesupplier
Niche supplierfor
foremulsion
emulsionpolymers,
polymers,inks,
inks,adhesives
adhesivesandandacrylic
acrylicmonomer
monomerstabilization
stabilization

* Excludes sales of divested water treatment chemicals product line

Staying The Course: Focus On Technology And Manufacturing Improvements


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Building Block Cytec Surface Specialties
Chemicals

2006 Sales M$1523 Latin America


Waterborne 3%
Asia
16% Radcure North America
17%
25%
28%
Liquid Coating Resins

17%

Amino Resins
55%
17% 22%

Powder
Solventborne Europe

2006 Operating Margin 6.3%

 Leadershippositions
Leadership positionsinineco-friendly
eco-friendlyand
andsolventborne
solventbornetechnologies
technologies

 Globalpresence,
Global presence,including
includingR&D
R&Dand andmanufacturing,
manufacturing,totoservice
servicecustomers
customers

Significant profit improvement potential from


growth and productivity initiatives 5
Building Block Cytec Engineered Materials
Chemicals

Business Growth
11% CAGR
700
600
500
Sales (M$)

400
300
200
100
0
2002 2003 2004 2005 2006
Diverse Range of Applications Global Reach
High Performance
Non—Aerospace
Asia Europe
Satellite & Launch 9% 8%
3%
Large Commercial
Biz/Reg Jet & Transport
42% 30%
17%
Comm Rotorcraft

62%
29%
North America

Military

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Building Block Building Block Chemicals
Chemicals

Run reliable operations to take advantage of market conditions


and be cash positive in all economic cycles.

2006 Sales M$339


Operating Margin 5%

Major Products
Acrylonitrile Acrylic Fiber, ABS plastic, Kemira
Hydrocyanic Acid Degussa

Melamine Cytec Surface Specialties (1/3 of capacity)


Merchant sales

Sulfuric Acid Degussa plus Merchant sales


Input Costs
Propylene Acrylonitrile
Ammonia Acrylonitrile, Melamine
Natural gas Energy

Well-Run, World-Scale Integrated Operations Focused On Operational Excellence


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Building Block
Chemicals Building Block Division Facts

Cytec Building Blocks Division

• ~410+ employees
• Capacity of over 2 billion pounds of industrial chemical production annually
• Location
 800 acres on the Mississippi River
 219 acres in process area, 20 acres immediately available
• Continuous process operations
• Access to all major forms of transportation

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Building Block Fortier Plant - History
Chemicals

1954 Today

• Land on which plant is sited was granted to Eugene Fortier by Spanish colonial government in 1776
• Fortier family sugar plantation until late 1800’s
• 1940-1950 was a decade of significant oil discovery and development in Louisiana
• Plentiful quantities of natural gas and limited shipment infrastructure led oil companies to look for natural gas
consuming partners
• Lucrative long-term natural gas contracts brought significant capital investment to the Louisiana gulf coast by
major chemical companies, concentrating in Ammonia and Fertilizer production
• 1953 : American Cyanamid constructs original complex at Fortier consisting of the following:
 Ammonia, Acetylene, HCN, Sulfuric Acid, Acrylonitrile, and Ammonium Sulfate
• 1976 : CYRO Joint Venture formed with Rhoem (now subsidiary of Degussa)
• 1989 : AMEL Joint Venture formed with DSM
• 1999 & 2001 : Shutdown of methanol and ammonia facilities due to high U.S. natural gas prices
• 2005 : Sale of Joint Venture interest in CYRO to Degussa (Cytec as operator)
• 2006 : Sale of Acrylamide business lines to Kemira (Cytec as operator)
• 2006: Assume full control of Melamine business with dissolution of AMEL joint venture
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Building Block
Chemicals
Melamine

Plant Characteristics

•70KMT Plant Capacity

• Original Construction 1971


• Major Expanded/Technology Upgrade 1989
• Expanded to current capacity in 2000

•Process Description:
Low Pressure Catalytic Trimerization of Urea

Melamine

Urea Section

C
H2N NH2
2NH3 + CO2 →
Ammonia + Carbon Dioxide Urea

Melamine Section

H2N N NH2

O N N

C
H2N NH2 NH2

Urea Melamine
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Building Block
Chemicals
Site Integration
Raw Materials Products and Intermediates Applications
Automotive coatings,
CO2 Urea Melamine laminated flooring,
countertops

Ammonia

Acrylic fibers, ABS,


Acrylonitrile Adiponitrile
Propylene
Polymers used in water
Acrylamide treating, mining, EOR,
cross linking agents
Sodium Cyanide,
HCN Methionine, Chelates

Acetone
Acrylic sheet, polymer
MMA products, CDs

Methanol

Natural Gas Steam MAS

Sulfur Sulfuric Acid Fertilizer, Pulp & Paper, Mining

Sites Synergy is key to Melamine Long Term Viability


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Building Block
Chemicals Cytec Melamine Business Model

• Capacity (Physical Production) ~70,000


Metric Tonnes per annum

• Downstream Cytec Demand Requirement 37,778


37,778

 North America 20,000 MT


 Europe 6,000 - 7,000 MT
 Asia (Purchased) 3,000 - 4,000 MT 6,803
6,803
Cytec North Am
Total ~30,000 MT 15,420 10,000 Cytec North Am
10,000 Cytec Europe
15,420
Cytec Europe
Sales Americas
Sales Americas
• Product Available for Merchant Sale ~40,000 Sales Europe
Sales Europe

• Target Mix
 North America 75%
 Europe 25%

10,000MT available for European Export Business

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Building Block
Chemicals Technical Aspects

• Cytec produces Grade ‘A’ Melamine


1. % Melamine 99.8%
2. Water < 0.1%
3. Color < 15 (APHA)

• Internal Cytec Amino Resins business demands drive quality requirements


• Coating and Resin applications primarily for sale to automobile OEM suppliers for
use in paint and clearcoat applications

• Other Major end use target markets


• Laminates (High and Low Pressure)
• Melamine Formaldehyde Resins
• Melamine Urea Formaldehyde Resins
• Plywood and other lumber applications
• Foam Products (Flame Retardant Additive)

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Building Block
Chemicals Cytec Marketing in Russia

marketed by
Melamine

United Trading System (UTS/ETC) : Swedish-Russian distribution Company

 Branches in
− St. Petersburg, Moscow, Novosibirsk, Yekaterinburg, Chernigov, and Kiev

Strengths
 Largest Distributor in Russia
 Product delivered to customer with tax and duty requirements completed
 Currency capable in Euro, Dollar, Rouble, and Grivna
 Inventory stock stored in Russia
 Local (Russian) sales and technical support

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Building Block
Chemicals Summary of Cytec Competencies

• Product • Placement

 Quality
 European Cytec-centric organization
− All Melamine produced to highest experienced in global commerce
melamine specifications supported by
Cytec worldwide demand for Amino
Resins  Russian supply chain managed by UTS for
seamless border clearance, delivery, and
support
 Reliability
− Business synergies and strong internal
demand support Cytec business model
− Long history of melamine manufacture

 Specialized shipping in package-type, sizes to


suit customer needs

• Promotion • Price

 UTS provides local expertise for contact on available  Product pricing competitive with other high quality
product, logistics, who can provide market feedback sources of supply

 Local supply chain to support reliability of supply

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Building Block
Chemicals For More Information

New York Stock Exchange


• Ticker Symbol : CYT

General Corporate Information or more detailed presentations


• www.cytec.com
 Investor Relations
 Presentations

Building Block Chemical Information


• www.cytec.com/building-block/index.htm

Presented by:
Gregory Zoglio
Director Sales and Marketing
Building Block Chemicals
10800 River Road
Westwego, LA 70098

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