The Engineered Materials segment includes the Company’s compounds and blends products sold into higher growth and value applications, such as consumer electronics and medical, as well as soft thermoplastic elastomers (“TPEs”) products which are sold into markets such as footwear and automotive. Additionally, following the PMMA Acquisition and the Aristech Surfaces Acquisition in 2021, the Engineered Materials segment also includes PMMA and MMA products, which are sold into a variety of applications including automotive, building & construction, medical, consumer electronics, and wellness, among others. The Latex Binders segment produces styrene-butadiene latex (“SB latex”) and other latex polymers and binders, primarily for coated paper and packaging board, carpet and artificial turf backings, as well as a number of performance latex binders applications, such as adhesive, building and construction and the technical textile paper market. The Base Plastics segment contains the results of the acrylonitrile-butadiene-styrene (“ABS”), styrene-acrylonitrile (“SAN”), and polycarbonate (“PC”) businesses, as well as compounds and blends for

automotive and other applications. On January 1, 2023, the Base Plastics segment will be renamed as Plastics Solutions to better reflect Trinseo’s strategic focus on providing solutions in areas such as sustainability and material substitution. The Polystyrene segment includes a variety of general purpose polystyrenes (“GPPS”) and polystyrene that has been modified with polybutadiene rubber to increase its impact resistant properties (“HIPS”). The Feedstocks segment includes the Company’s production and procurement of styrene monomer outside of North America, which is used as a key raw material in many of the Company’s products, including polystyrene, SB latex, and ABS resins. Lastly, the Americas Styrenics segment consists solely of the operations of the Company’s 50%-owned joint venture, Americas Styrenics, a producer of both styrene monomer and polystyrene primarily in North America.

The following table provides disclosure of the Company’s segment Adjusted EBITDA, which is used to measure segment operating performance and is defined below, for the years ended December 31, 2022, 2021, and 2020. Asset and intersegment sales information by reporting segment is not regularly reviewed or included with the Company’s reporting to the chief operating decision maker. Therefore, this information has not been disclosed below. Refer to Note 3 for the Company’s net sales to external customers by segment for the years ended December 31, 2022, 2021, and 2020.

(1)

The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and benefits, and other items. Segment Adjusted EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts, and prior year financial results, providing a measure that management believes reflects core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use segment Adjusted EBITDA, or similarly-named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance.

The reconciliation of income before income taxes to segment Adjusted EBITDA is as follows:



	Year Ended December 31,
	2022		2021		2020
Income (loss) from continuing operations before income taxes	$	(469.6)	$	350.5	$	105.4
Interest expense, net		112.9		79.4		43.6
Depreciation and amortization		236.9		167.5		92.6
Corporate Unallocated⁽²⁾		88.0		95.6		81.7
Adjusted EBITDA Addbacks⁽³⁾		431.5		132.0		43.5
Segment Adjusted EBITDA	$	399.7	$	825.0	$	366.8

(2)	Corporate unallocated includes corporate overhead costs and certain other income and expenses.

(3)	Adjusted EBITDA addbacks for the years ended December 31, 2022, 2021, and 2020 are as follows:


	Year Ended December 31,
	2022		2021		2020
Net gain on disposition of businesses and assets	$	(1.8)	$	(0.6)	$	(0.4)
Restructuring and other charges (Note 21)		15.9		9.0		5.6
Acquisition transaction and integration net costs (Note 4)		6.6		75.3		9.1
Acquisition purchase price hedge (gain) loss (Note 13)		—		22.0		(7.3)
Asset impairment charges or write-offs (Note 14)		6.3		6.8		11.0
European Commission request for information (Note 16)		36.2		—		—
Goodwill impairment charges (Note 10)		297.1		—		—
Other items ^(a)		71.2		19.5		25.5
Total Adjusted EBITDA Addbacks	$	431.5	$	132.0	$	43.5

(a)

Other items for the years ended December 31, 2022 and 2021 primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives, including our ERP upgrade project. Other items for the year ended December 31, 2020 primarily relate to advisory and professional fees incurred in conjunction with the Company’s initiative to transition business services from Dow, including certain administrative services such as accounts payable, logistics, and IT services, which was substantially completed in 2020, as well as fees incurred in conjunction with certain of the Company’s strategic initiatives.

Geographic Information

As of December 31, 2022, the Company operates 39 manufacturing plants and one recycling facility at 33 sites in 15 countries, inclusive of its joint venture. It also operates 11 R&D facilities globally, including technology and innovation development centers. Sales are attributed to geographic areas based on the location where sales originated; long-lived assets are attributed to geographic areas based on asset location. The Company is incorporated under the existing laws of Ireland, as discussed in Note 1, which therefore represents its country of domicile. The Company has no sales generated from this country. The Company has $3.1 million of existing long-lived assets generated from this country as of December 31, 2022. The Company had no existing long-lived assets generated from this country as of December 31, 2021.


	As of and for the Year Ended
	December 31,
	2022		2021		2020
United States
Sales to external customers	$	1,236.3	$	928.7	$	466.6
Long-lived assets		190.0		184.9		43.9
Right-of-use assets - operating, net		20.1		19.5		18.7
Europe
Sales to external customers	$	2,684.8	$	2,755.8	$	1,453.0
Long-lived assets		388.0		410.3		269.1
Right-of-use assets - operating, net		52.3		61.9		53.9
Asia-Pacific
Sales to external customers	$	914.9	$	1,048.8	$	753.4
Long-lived assets		107.6		114.5		118.1
Right-of-use assets - operating, net		3.7		3.9		5.2
Rest of World
Sales to external customers	$	129.5	$	94.2	$	71.6
Long-lived assets		5.5		9.3		—
Right-of-use assets - operating, net		—		—		—
Total
Sales to external customers⁽¹⁾	$	4,965.5	$	4,827.5	$	2,744.6
Long-lived assets⁽²⁾		691.1		719.0		431.1
Right-of-use assets - operating, net⁽³⁾		76.1		85.3		77.8

(1)

Sales to external customers in Germany represented approximately 10% of the total for the year ended December 31, 2022, and approximately 12% of the total for each of the years ended December 31, 2021 and 2020. Sales to external customers in Hong Kong represented approximately 9%, 11%, and 14% of the total for the years ended December 31, 2022, 2021, and 2020, respectively. Sales to external customers in the Netherlands represented approximately 8% of the total for each of the years ended December 31, 2022, 2021, and 2020.

(2)

Long-lived assets in Germany represented approximately 12%, 12%, and 22% of the total as of December 31, 2022, 2021, and 2020, respectively. Long-lived assets in The Netherlands represented approximately 13%, 14%, and 26% of the total as of December 31, 2022, 2021, and 2020, respectively. Long-lived assets in Italy represented approximately 21%, 22%, and 6% of the total as of December 31, 2022, 2021, and 2020, respectively. Long-lived assets consist of property, plant and equipment, net, and finance lease ROU assets, net.

(3)

Operating lease ROU assets in The Netherlands represented approximately 46%, 48% and 66% of the total as of December 31, 2022, 2021, and 2020, respectively. Operating lease ROU assets in Ireland represented approximately 10% of the total as of December 31, 2022 and 2021. There were no balances in Ireland as of December 31, 2020.