Presentation by Laurent Schmitt, President of Rhodia Polyamide

Analyst & Investor Day – Lyon – July 10, 20071

Laurent Schmitt, PresidentAnalyst & Investor Day - July 10, 2007

Rhodia Polyamide


Outline program

Rhodia Polyamide overview

Innovation to market

Laurent Schmitt, President

Jean-Pierre Marchand, R&D Vice President Vincent Lajotte, Marketing Director

Polyamide teams

Belle-Etoile Plant visit & shop floor presentations



Rhodia Polyamide today

Rhodia Polyamide strategy

Our two key success drivers: . Competitiveness . Growth through innovation


14 Industrial sitesworldwide

N°2 in Polyamide 6.6

N°3 in Engineering Plastics

Polyamide: A sustainable pillar of Rhodia

40 % Group Net Sales 41 % Group Recurring EBITDA

Recurring EBITDA€ 284 million

Net Sales € 1,922 million

Employees4,000

2006 data

Recurring EBITDA Margin14.8 %


Portfolio structure and market presence reflecting our strategy

2006 data (€m)

Focus on Intermediates & Engineering Plastics > 85 % sales

Global Net Sales: + 12 % in 2006Asian Net Sales: + 40 % in 2006

2006 Net Sales 2006 Net Sales

Nylon Intermediates

45 %EngineeringPlastics

Fibers12 %

24 %

Non Nylon Intermediates (Phenol & solvents)

19 %

359

Intermediatesexcept AA

580AdipicAcid

275

469

239

North America

Europe

Asia

South America 790

392

660

80

44%

16%

Europe

Asia

South America

North America

760

279

2005 Net Sales

592

79


Well-diversified final markets

2006 data

Auto

Electric & Electronics

Consumer & Industrial Goods

Clothing & shoes

Construction

Others

Coatings & adhesives

7 %

8 % 29 %

7 %

12 %

26 %

11 %

Net Sales breakdown by end markets


A fully integrated Polyamide 6.6 value chain

Engineering Plastics

Industrial & technical yarns

Textile yarns

Nylon salt

ADN

PA 6.6

PA 6

Cumene Phenol

Caprolactam

Cyclohexane

Solvents

Nat Gas

Naphtha

BenzenePropylene

Nat Gas

Benzene

Nat GasBenzene

Nat Gas

Nat Gas

Nat Gas HCN

Worldwide Brazil only

Ammonia

Adipicacid

10 % of sales

90 % of sales

Cyclohexanol

KA-Oil

PolyamideIntermediates & PolymersRaw materials

HMDAButadiene

Bought in Raw Materials

mailto:[email protected]


Paulinia

Santo Andre

Mississauga

Sao Paulo

Detroit

Jacarei

San Bernardo

A strong worldwide industrial presence

Qingdao

Asia

Seoul

Shanghai

Onsan

Manufacturing Plant

Application & Technology Development Centre

R&D centre

Worldwide Headquarters

Regional Headquarters

EuropeNorth/Latin America

14 industrial sites worldwide

Gorzow

Freiburg

2006 data

Chalampé

Lyon

Belle-Etoile

Valence

Blanes

Ceriano


2006 major achievements

Performance

• 2006 Recurring EBITDA up 17 % vs 2005 - robust Recurring EBITDA margin at 14.8 %

• Solid pricing more than offsets raw material cost increases • Strong volume growth driven by Asia & Latin America

• Preparing new strategic options for our future developments in Asia

• Industrial Fibers Europe divestment • Engineering Plastics growth:

• Continuous volume growth +11 % in 2006• Successful start up of Shanghai plant

Building forthe future







Polyamide’s Strategy

Engineering Plastics: The growth engine

Intermediates:Sustainable leadership

Strengthen our leading worldwide position in Polyamide 6.6

• World class competitive position in polyamide intermediates

• Established growth roadmap with strong focus in fast growing zones

• Tight supply/demand situation for key intermediates (ADN) expected to last until at least 2011

• Strong leadership built on:• Innovation• Customer intimacy• A highly competitive worldwide industrial base

• Market growth driven by substitution from metals

• Leadership position in high growth Asian & Latin American countries and key markets

Growth focus on Asia & Brazil


ADN: Tight supply vs demand setto remain for the coming years

Evolution in capacity will only match demand growth

• Marginal debottleneckingunderway at Rhodia & Invista

• Closure of BASF ADN facility(2009)

• Full capacity utilisation

• Maintenance shutdownsimpact volume availability

• Rhodia & Invista launch feasibilitystudies for Asian ADN plantsin 2011/12 but no firm commitmentsADN demand Industry utilization rate

94%

87%

86%

91%

89%

90%

91%

0

200

400

600

800

1000

1200

1400

1600

1800

1995

2002

2004

2006

2008

2010

2012

2014

2016

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Qingdao

Strengthening our position in Asia

Manufacturing PlantApplication & Technology Development Centre

R&D centreRegional Headquarters

Seoul

Shanghai

Onsan

Asia

N°1 Asian quality supplier referenceISO 9001 / TS 16949 certifications

• A strong base to build on • Polyamide Intermediates & polymers

Asia’s largest Adipic Acid plant based in Onsan, South Korea

• Engineering plastics N°1 South Korea and n°2 in China Capacity more than doubled in last 7 years

• Strengthening our competitiveness • New Nylon salt / polymer plant on stream

by December 07

• New HMDA plant on stream by end 2009

• Feasibility study of new ADN capacity underway


Confirming our leading position in Brazil

• Building on a strong established n°1 position • Polyamide Intermediates

Expanding in 07/08 existing phenol and cyclohexanol facilities

• Engineering plastics & polymersSales doubled over the last 5 years and growth set to continue

Paulinia

Santo Andre

Mississauga

Sao Paulo

Detroit

Jacarei

San Bernardo

North/Latin America

R&D centreRegional Headquarters

Manufacturing PlantApplication & Technology Development Centre







Polyamide’s Do It Program

• A global continuous improvement program initiated in 2006

• A management process designed to • Deliver our targets• Anticipate future improvements

• Using methodology tools such as Six Sigma

• Polyamide’s "Golden Rules"


Do It program: participative management

Generate objectives& identify project ideas

Pilot the results

& follow up the gap

Launch&

manageprojects

Worldwidenetwork

EBITDA Working capital


Do It actions improve EBITDA

2006 estimates

Do It action plans cover all areas

Pricing

Process Efficiency

Supply Chain

Fixed Costs

Mix & Volumes

Estimatedcontribution

to Do It Improvements


Do It reduces working capital

2006 estimates

Payment term renegotiation

Fight against early deliveries

Overdue reductionPayment term renegotiation

Inventories

Receivables

Payables Step change inventoryConsignment stock


Belle-Etoile Case studies

From major impact Do It projects to field actions improvement:

• Polaris debottlenecking: a major Six Sigma project leading to a 10 000 tons capacity increase without any investments (+ 20 %)

• Technyl® reduction of waste generation: Operators involvement to ensure a higher reliability of a polymer line pelletizing





Our two key success drivers: . Competitiveness. Growth through innovation


Rhythm of growth through innovation set to continue

• Engineering plastics: our growth focus • High growth exceeds market • High percentage of new products • Close partnership with customers

• Engineering plastics: innovation strategy• Focus on the automotive market• Leveraging our unique position

as a fully integrated PA6.6 player• Providing additional services to our

customers

4 %

6 %5 % 5 %

9 %

13 %

8 %

11 %

2003 2004 2005 2006

Market Growth Rhodia EP Growth (restated data)


Polyamide faces great perspectives in automotive

Natural automotive market growth 2005 -> 63 000 000 vehicles2010 -> 76 000 000 vehicles

Perspective of plastic part gain in vehicle 2005 -> 9 kg : 567 000 T

11 kg

873 000 T

13 kg

988 000 T

9 kgVehicle increase only Vehicle increase + 2 or 4 kg of Polyamide

684 000 T

+ 21 % (+ 4 % p.a) + 54 % (+ 9 % p.a) + 74 % (+ 12 % p.a)

Source: JD Powers


Focus in the automotive market:innovate in new profitable automotive segments

Under-the-hood opportunitiesBlow molded gradesHigh temperature grades

Structural partsHighly filled compoundsCar body panel

Conductive grades

Fuel tubing & reservoirFuel barrier


Leveraging our mastery of the PA 6.6 chain:from intermediates to polymers and compounds

• Polymers and compounds with improved ageing and high temperature performances

• Cost effective polymers and compounds with improved "Flowability" and surface aspects

• Compounds with higher dimensional stability


Providing additional value to our customers

• Advanced design solutions for PA 6.6 based parts

• PA 6.6 with improved "processability" at molders

• End-of-life recycling service

Breakage point simulation


Supporting growth

Number of filed Patents New product sales less than 5 years old€m

0

100

200

300

400

500

2004 2005 2006

H1

8

12

24

• Growing sales from new products• 20% of sales now from new products• Significant increase in patents

• Enhancing process and yield performance• Substantial gains in industrial performance

2005 2006 2007 expected

Analyst & Investor Day – Lyon – July 10, 200729Analyst & Investor Day - July 10, 2007

Rhodia PolyamideInnovation to market - Products


Temperature, dimensional & processabilityPA 6.6 for body panels

• PA 6.6 for body panels• Metal replacement : impact / design / surface• On line paintable / thermal resistance/ dimensional stability• Fully recyclable

• Weight reduction / Design flexibility• Integration in assembly line• End-of-life recycling

2) CED 3) drying 4) base and clear coat 5) drying

On line fender introduction

1) Fender assembling

Rhodia innovation

Market Needs

Market: Automotive Exterior Parts


Flowability & surface aspectPA 6.6 high flow

New market field

• Fill the niche between high performance polymers, metal and engineering plastics to propose very high performance and easy processability at lower cost

Market Opportunities

• A unique high fluidity PA 6.6 allowing highly filled compounds• Breakthrough answering both converters & end-user key needs

• Converters• Large processing window• Lower cost

• End-users• High mechanical and thermal performances• Flexibility in part design

Rhodia innovation


Greener material & end-of-life recyclingPA 6.6 for fuel tanks

Market: Motorcycle fuel tanks

• Weight reduction & design freedom• Environment friendly solutions • Norms & regulations • Cost saving

Market Needs

• PA 6.6 for fuel tanks• Metal & other multi-layer solutions replacement • Eco design & recyclability• Low permeation & impact resistance• Function & production steps integration

Rhodia innovation


Advanced design solutionsMicro-mechanics

Market Needs

• Ease and speed up metal substitution through predictive simulation

• Save cost by optimizing part design: Material / Prototype cost• Improve time to market

Market: All

• Micro-mechanics• Highly predictive modelling solution development• Validated material model database for TECHNYL®

• A predictive micro-structure modelling for composites

Rhodia innovation


Rhodia PolyamideBelle-Etoile Industrial Platform

Analyst & Investor Day - July 10, 2007


Belle-Etoile industrial platform

Construction1952

Total surface57 hectares

Production310 000 tonnes

Employees440


Technyl

Belle-Etoile plant

Polaris

HMDA plant capa 120 kt/y

Nylon salt plant capa 140 kt/y

Polymerization unit capa 53 kt/y

Compounding plant capa 48 kt/y

Hydrogen facilitycapa 14500 Nm3/h


Laurent Schmitt, PresidentAnalyst & Investor Day - July 10, 2007

Rhodia Polyamide

Documents

Presentation by Laurent Schmitt, President of Rhodia Polyamide