Kraton Polymers 8-K Fourth Quarter Earnings Call

Kraton Polymers LLC

Fourth Quarter Earnings Call

March 27, 2009

Exhibit 99.1

2

Disclaimers

Forward Looking Statements

This

presentation

may

include

“forward-looking

statements”

which

are

statements other than statements of historical fact and are often characterized

by

the

use

of

words

such

as

“believes,”

“expects,”

“estimates,”

“projects,”

“may,”

“will,”

“intends,”

“plans”

or “anticipates,”

or by discussions of strategy,

plans or intentions. All forward-looking statements in this presentation are

made based on management's current expectations and estimates, which

involve risks, uncertainties and other factors that could cause results to differ

materially from those expressed in forward-looking statements. Readers are

cautioned not to place undue reliance on forward-looking statements. We

assume no obligation to update such information.

GAAP Disclaimer

This presentation includes non-GAAP financial measures, including EBITDA

and LTM Bank EBITDA.

Investors should consider these measures, which we

believe investors consider useful in assessing our performance and

compliance with our financial covenants, together with the GAAP measures

from

our

financial

statements.

A

reconciliation

of

the

non-GAAP

financial

measures used in this presentation to the most directly comparable GAAP

measures can be found in our press release dated March 26, 2009.

3

2008 Highlights

Cost-Out / Efficiency

Gains

System upgrade and control optimization approved for Belpre

site which will improve competitiveness and operating

efficiency upon completion

Pernis SIS shutdown delivered expected results

New RTS facility progressing as planned

Innovation

Sales from innovation was 13.5% of total revenue

Announced Sulfonated

block copolymers

Completed pre-registration within Europe to comply with regulation

requirements of REACH

Business

Performance

Q4 2008 EBITDA up $20 million versus Q4 2007

$50 million improvement in LTM Bank EBITDA from YE 2007    

Solidly within compliance of financial covenants

IR Latex achieved new milestones in both production and sales;

this business relatively resilient to global economic slowdown

Headwinds

Monomer and energy costs declined in the fourth quarter from

unprecedented highs, but year-on-year still above 2007

4

51%

3%

14%

13%

10%

Revenue and Innovation Growth

(28)%

107%

(3)%

(10)%

(12)%

5%

11%

13%

14%

2005

2006

2007

2008

(2)

Innovation revenue defined as revenue from products introduced within the last 5 years

Q4 2008 vs. Q4 2007

Revenue    Change By End-Use

Adhesives,

Sealants,

and Coatings

Total

Advanced

Materials

Paving

and

Roofing

(1)

Excludes footwear and noncore high styrenics, which aggregate approximately 2% of revenue

FY 2008 vs. FY 2007

Revenue    Change By End-Use

Adhesives,

Sealants,

and Coatings

Total

Advanced

Materials

Paving

and

Roofing

Innovation

Revenue

as

a

%

of

Total

Revenue

(2)

(1)

(1)

IR Latex

IR Latex

2008

Financial Performance

6

Summary Financial Information

($MM)

2.45

4.15

Interest Coverage

5.45

3.87

Leverage

$     

539

$ 

575

Total Debt

$

99

$

149

LTM Bank EBITDA

(2)

$

58

$

127

$

(5)

$

15

EBITDA

(1)

$

1,090

$

1,226

$

258

$

232

Total Operating Revenues

358

313

82

53

Sales Volume (kT)

2007

2008

2007

2008

YTD December 31

Fourth Quarter

(1)

EBITDA is used by management to evaluate operating performance.  EBITDA is not a recognized term under GAAP and does not

purport to be an alternative to net income (loss) as an indicator of operating performance.

(2)

LTM Bank EBITDA is defined as EBITDA adjusted for items pursuant to the senior secured credit facility.

7

Revenue

Sales

ByProduct

$15

($5)

2007

2008

Fourth Quarter

2008 Financial Summary

Price and mix up $69 million

Volume decline of 30kt

Price and mix more than

offset increase in feedstocks

and other costs

2008 includes $8 million

lower-of-cost-or-market

adjustment

$20 million improvement

2008 includes $8 million

lower-of-cost-or-market

adjustment

Operating Revenue ($MM)

$24

$254

$8

Gross Profit ($MM)

2008

Financial EBITDA ($MM)

2007

2008

$258

$4

$223

$232

$49

$21

2007

2008

2007

8

2008 Financial Summary

Each end-use posted year-

on-year revenue growth

Price & mix up $173 million

Volume decline of 44.5kt

Price and mix more than

offset increase in feedstocks

and other costs

Margin up nearly 700 basis

points

$69 million improvement

$16 million increase in

certain items:

Increase in restructuring

and other charges of $8

million

Lower-of-cost-or-market

adjustment of $8 million

9

Capitalization Table and Covenants

LTM Bank EBITDA

(1)

($MM)

Leverage A/O

December 31

(1)

Prior to December 31, 2008 LTM Bank EBITDA includes $9.6mm Equity Cure

$98.9

$104.1

$115.8

3.87

4.15

2.50

4.95

Actual

Covenant

Interest Coverage A/O

December 31

Actual

Covenant

12/31/07

3/31/08

6/30/08

$148.7

9/30/08

$146.0

12/31/08

$575.1

36.1

(10.0)

46.1

$539.0

Total Debt

$473.7

(17.0)

---

(17.0)

$490.7

Net Debt

$101.4

53.1

(10.0)

63.1

$48.3

Cash

$---

$200.0

$325.1

$50.0

December 31, 2008

(0.5)

---

(13.4)

50.0

Total changes

---

---

(10.0)

---

Voluntary repayments

(0.5)

---

(3.4)

50.0

Increase (Decrease)

$0.5

$200.0

$338.5

$---

December 31, 2007

January 2014

May 2013

May 2011

Maturity

8.125%

L + 200

L + 225

Rate

Insurance

Bond

Sr. Notes

Term

Revolver

$575.1

36.1

(10.0)

46.1

$539.0

Total Debt

$473.7

(17.0)

---

(17.0)

$490.7

Net Debt

$101.4

53.1

(10.0)

63.1

$48.3

Cash

$---

$200.0

$325.1

$50.0

December 31, 2008

(0.5)

---

(13.4)

50.0

Total changes

---

---

(10.0)

---

Voluntary repayments

(0.5)

---

(3.4)

50.0

Increase (Decrease)

$0.5

$200.0

$338.5

$---

December 31, 2007

January 2014

May 2013

May 2011

Maturity

8.125%

L + 200

L + 225

Rate

Insurance

Bond

Sr. Notes

Term

Revolver

10

2009 Roadmap Plan Priorities

Make It Happen

Price Right

Balance the value created for our customers

Preserve margin through cost outs, efficiency gains and

innovation

Innovation-Led Top-line

Growth

Deliver 16% Sales From Innovation

Strengthen our industry leadership through innovative

products and market

Capital Structure and

Cash

Diligently manage cash and deliver the business

Working capital management and tight credit monitoring

Maintain optionality

with respect to capital investments;

plan capex

is $45 million, reduced from more than $70

million pipeline

Productivity

Improve overall returns

Capture benefit of cost out initiatives

Relentless pursuit of efficiency gains

11

Recent Developments

Price Right

Excluding year-on-year changes in FIFO adjustments,

Q1 2009 EBITDA anticipated to be in line with Q1 2008

Innovation-Led Top-line

Growth

Awarded North American Technology Leadership Award from

Frost & Sullivan

Announced Sulfonated

block copolymers

Announced Kraton A1535 block copolymers

RTS facility relocations in Houston and Japan moving forward in

accordance with plans

Capital Structure and

Cash

$30 million bond repurchase completed in March

Productivity

On target to exceed $10 million cost reduction target

Reductions in plant fixed costs, global staff reduction, freeze on

salaries and adds

to

staff,

and

“salary

at

risk”

program

Global ERP upgrade to improve productivity and drive near-

term cost savings

12