Transcript Slide 1

The World of Epoxy Adhesives

TRFA Annual Meeting Philadelphia PA November 11, 2003 David P. Nick DPNA International Inc.

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Global Formulated Adhesive Market Demand Asia Pacific 27% Rest of World 3% North America 34% West & East Europe 34% Latin America 2%

2002 Global Formulated Adhesive Market Demand: 18.0 billion pounds ♦ $24.5 billion ♦ AGR 3.0% Source: DPNA International Inc.

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Global Formulated Adhesive Resin Demand Others 31% Acrylic 17% Epoxy 4% Polyurethane 3% Rubber 17% Vinyl 28%

2002 Global Formulated Adhesive Market Demand: 18.0 billion pounds ♦ $24.5 billion ♦ AGR 3.0% Source: DPNA International Inc.

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Global Liquid Epoxy Resin Production Other 28% Adhesives 31% Coatings 41%

2002 Total Liquid Epoxy Resin Demand: 2.14 billion pounds ♦ 970 thousand metric tons ♦ $2.0 billion ♦ Source: DPNA International Inc.

AGR 4%-5%

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Major Epoxy Resin Producers

 Dow Chemical  Resolution Performance Products  Vantico  Nan Ya  Chang Chun  Others

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Construction Assembly Consumer/DIY Transportation Major Adhesive End Use Segments North America West Europe Latin America Japan China/ Other

Source: DPNA International Inc.

Mature Growth 6

Major North America Epoxy End Use Segments Construction Mature Growth DIY Transportation Assembly Large Market Small Market 7

New Technical Developments Affecting Epoxy Demand

Toughened Epoxies

High Performance Underwater Curing

< 5 Minute RT Curing

One Pack Systems

Hybrid Polymers

Dispensing Equipment

Curing Systems

Expanding Assembly Applications 8

Global Assembly Market

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Global Fastening Market-2002 Bolts & Nuts 30% Crimps 5% Other 2% Adhesives 4% Rivets 12% Tabs 4% Screws/Nails 15% Total Market Value: $802 Billion Source: DPNA International Inc.

Weld/Braze 28% 10

Assembly Market Percent Growth Rate 5% 4% 3% 2% 1% 0% Electronics Medical

Source: DPNA International Inc.

Sub-Assemblies 11

800 700 600 500 400 300 200 100 0 Comparison of Competing Adhesives (Million Pounds)

3,0% AGR 4,0% AGR 5,0% AGR 4,0% AGR 3,0% AGR 7,0% AGR

Epoxy Poly urethane Cyano acrylates Mod. SGA Acrylics Silicone

Source: DPNA International Inc.

M-S Polymer 2002 2005 12

Epoxy Adhesive Regional Growth Comparison Percent Growth Rate 8% 7% 6% 5% 4% 3% 2% 1% 0% North America West Europe Asia Pacific China Japan Others

Source: DPNA International Inc.

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Global Epoxy Adhesive Market Driving Forces

Economic recession in the USA and Europe

Stagnant growth in Japan

Recent price increases

Fluctuating oil prices

War in Iraq 14

Global Epoxy Adhesive Market Driving Forces (Continued)

Continued growth in China

Environmental and health concerns (Europe/Japan)

Consolidation and changing suppliers

Customer and market relocation 15

Macro Trends and Issues

E-Commerce

Rising Energy Costs

Shrinking Profits

Backward Facing Support

Partnering for Success

Consolidation/Globalization

Niche Marketing 16

New Market Trends and Opportunities

Fastening options

Changing substrates

New polymers

Market dislocations 17

Future Outlook

Growth will come from new bonding applications and polymer developments

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David P. Nick President DPNA International, Inc.

126 Allendale Circle Troutman, NC - USA Tel (704) 528-3985 Fax (704) 528-3986 Email: [email protected]

Website: www.dpna-international.com

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