Albemarle Reports Third Quarter 2024 Results
Albemarle (NYSE: ALB) reported third-quarter 2024 results with net sales of $1.4 billion and a net loss of ($1.1) billion, or ($9.45) per diluted share. The loss included $861 million in pre-tax charges primarily from capital project asset write-offs. Energy Storage and Specialties volumes increased by 16% and 4% respectively. The company announced cost-saving initiatives including a 6-7% global workforce reduction and transition to an integrated functional model, expecting annual savings of $300-400 million. FY2025 capital expenditures will be reduced by approximately 50% to $800-900 million. Albemarle maintains its full-year 2024 outlook despite lower market pricing, supported by cost improvements and higher volumes.
Albemarle (NYSE: ALB) ha riportato i risultati del terzo trimestre 2024 con vendite nette di 1,4 miliardi di dollari e una perdita netta di 1,1 miliardi di dollari, pari a 9,45 dollari per azione diluita. La perdita includeva 861 milioni di dollari in oneri non imponibili, principalmente dovuti a svalutazioni di attivi di progetti di capitale. I volumi nella Storage Energetica e nelle Specialità sono aumentati rispettivamente del 16% e del 4%. L'azienda ha annunciato iniziative per il risparmio dei costi, tra cui una riduzione della forza lavoro globale del 6-7% e la transizione verso un modello funzionale integrato, prevedendo risparmi annuali di 300-400 milioni di dollari. Le spese in conto capitale per l'anno fiscale 2025 saranno ridotte di circa il 50% a 800-900 milioni di dollari. Albemarle mantiene le sue previsioni per l'intero anno 2024 nonostante la riduzione dei prezzi di mercato, supportata da miglioramenti dei costi e volumi maggiori.
Albemarle (NYSE: ALB) reportó los resultados del tercer trimestre de 2024 con ventas netas de 1,4 mil millones de dólares y una pérdida neta de 1,1 mil millones de dólares, o 9,45 dólares por acción diluida. La pérdida incluyó 861 millones de dólares en cargos antes de impuestos, principalmente por cancelaciones de activos de proyectos de capital. Los volúmenes de Almacenamiento de Energía y Especialidades aumentaron un 16% y un 4% respectivamente. La empresa anunció iniciativas de reducción de costos, incluyendo una reducción del 6-7% en la fuerza laboral global y la transición a un modelo funcional integrado, esperando ahorros anuales de 300-400 millones de dólares. El gasto de capital para el año fiscal 2025 se reducirá aproximadamente en un 50% a 800-900 millones de dólares. Albemarle mantiene su pronóstico para todo el año 2024 a pesar de la baja en los precios del mercado, respaldado por mejoras en costos y volúmenes más altos.
알베말 (NYSE: ALB)는 2024년 3분기 실적을 발표했으며, 순매출은 14억 달러, 순손실은 11억 달러로 주당 희석 기준 9.45달러의 손실을 기록했습니다. 이 손실에는 주로 자본 프로젝트 자산 감소에 따른 세전 비용 8억 6100만 달러가 포함되어 있습니다. 에너지 저장 및 특수 분야의 물량은 각각 16%와 4% 증가했습니다. 회사는 글로벌 인력의 6-7% 감소와 통합 기능 모델로의 전환을 포함한 비용 절감 계획을 발표했으며, 연간 3억~4억 달러의 절감을 기대하고 있습니다. 2025 회계연도 자본 지출은 약 50% 감소하여 8억~9억 달러가 될 것입니다. 알베말은 비용 개선과 더 높은 물량에 의해 지원되면서 시장 가격 하락에도 불구하고 2024년 연간 전망을 유지하고 있습니다.
Albemarle (NYSE: ALB) a annoncé les résultats du troisième trimestre 2024, avec des ventes nettes de 1,4 milliard de dollars et une perte nette de 1,1 milliard de dollars, soit 9,45 dollars par action diluée. La perte comprenait 861 millions de dollars de charges avant impôt, principalement liées à des amortissements d'actifs de projets d'investissement. Les volumes de stockage d'énergie et des spécialités ont augmenté de 16 % et 4 % respectivement. L'entreprise a annoncé des initiatives d'économies de coûts, y compris une réduction de 6 à 7 % de l'effectif mondial et une transition vers un modèle fonctionnel intégré, s'attendant à des économies annuelles de 300 à 400 millions de dollars. Les dépenses en capital pour l'exercice 2025 seront réduites d'environ 50 % pour atteindre 800 à 900 millions de dollars. Albemarle maintient son perspective pour l'année 2024, malgré la baisse des prix du marché, soutenue par des améliorations des coûts et des volumes plus élevés.
Albemarle (NYSE: ALB) hat die Ergebnisse des dritten Quartals 2024 veröffentlicht, mit einem Nettoumsatz von 1,4 Milliarden Dollar und einem Nettoverlust von 1,1 Milliarden Dollar, was 9,45 Dollar pro verwässerter Aktie entspricht. Der Verlust beinhaltete 861 Millionen Dollar an Vorsteueraufwendungen, hauptsächlich durch Abwertungen von Anlagevermögen im Zusammenhang mit Kapitalprojekten. Die Volumina in der Energiespeicherung und den Spezialitäten stiegen um 16% bzw. 4%. Das Unternehmen gab Kostensenkungsmaßnahmen bekannt, darunter eine Reduzierung der globalen Belegschaft um 6-7% und die Umstellung auf ein integriertes Funktionsmodell, wobei jährliche Einsparungen von 300-400 Millionen Dollar erwartet werden. Die Investitionsausgaben für das Geschäftsjahr 2025 sollen um etwa 50% auf 800-900 Millionen Dollar gesenkt werden. Albemarle hält trotz niedrigerer Marktpreise an seinen Prognosen für das Gesamtjahr 2024 fest, gestützt von Kostenverbesserungen und höheren Volumina.
- Operating cash flow of $241 million with >100% conversion rate
- Energy Storage and Specialties volumes up 16% and 4% respectively
- Expected annual cost savings of $300-400 million from restructuring
- Specialties adjusted EBITDA up 22% and Ketjen adjusted EBITDA up 134% year-over-year
- Net loss of $1.1 billion ($9.45 per diluted share)
- Adjusted diluted loss per share of $1.55
- Pre-tax charges of $861 million from asset write-offs
- Planned reduction of 6-7% in global workforce
- 50% reduction in FY2025 capital expenditures
Insights
Albemarle's Q3 results reveal significant challenges with a net loss of
The company's aggressive cost-cutting measures, targeting
While maintaining full-year guidance, the expectation to hit the lower end of the range indicates continued market weakness. The transition to a functional model and
The lithium market's deteriorating conditions are evident in Albemarle's strategic pivot. Their outlook implies lithium prices of
Despite volume growth in Energy Storage (
Third-Quarter 2024 and Recent Highlights
(Unless otherwise stated, all percentage changes represent year-over-year comparisons)
- Net sales of
$1.4 billion 16% and4% , respectively - Net loss of
( , or ($1.1) billion $9.45 $861 million - Adjusted diluted loss per share attributable to common shareholders of (
$1.55 - Adjusted EBITDA of
$211 million 22% year-over-year and Ketjen adjusted EBITDA up134% year-over-year - Cash from operations of
$241 million 100% operating cash flow conversion(a), driven by favorable working capital management - Maintaining full-year 2024 outlook considerations due to productivity and cost improvements, higher volumes, and the performance of long-term contracts
- Progressed comprehensive review of cost and operating structure; additional details include:
- Implementing new operating structure to maintain long-term competitiveness, streamlining organization to an integrated functional model
- Driving additional cost and productivity improvements of
$300 million $400 million - Reducing global workforce by an expected 6
-7% , representing approximately15% of non-manufacturing workforce - Decreasing FY 2025 capital expenditures by approximately
50% versus FY 2024 to an anticipated range of$800 million $900 million
(a) | Defined as Operating Cash Flow divided by Adj. EBITDA |
"Our steadfast focus on execution allowed us to deliver solid third-quarter results and maintain our full-year 2024 corporate outlook considerations as cost improvements, higher volumes, and the performance of our long-term contracts offset lower market pricing," said Kent Masters, Albemarle's chairman and CEO.
Masters continued, "Through our strategic review of Albemarle's cost and operating structure, we have identified significant opportunities to reduce cost, improve productivity and decrease capital spending while ensuring we efficiently serve customers and our end-markets. These actions are designed to increase Albemarle's financial flexibility, strengthen our core capabilities and position the company to maintain its leadership position long-term."
Additional Actions in Connection with Comprehensive Review of Cost and Operating Structure
During the third quarter, Albemarle progressed the previously announced comprehensive review of its cost and operating structure, building on the actions announced with the company's second quarter 2024 earnings release. Effective November 1, 2024, Albemarle implemented a new operating structure, which included transitioning to an integrated functional model designed to increase agility, deliver significant cost savings and maintain long-term competitiveness. The company is also announcing today a global workforce reduction expected to impact 6
The annual run-rate cost savings of actions in connection with the comprehensive review is expected to be in the range of
These savings are in addition to cost savings of over
Full-year 2025 capital expenditures are expected to be in the range of
Total Corporate Outlook Considerations
The company is maintaining its prior full-year 2024 outlook considerations, which are based on observed lithium market price scenarios. The previously published
All other corporate outlook considerations are unchanged.
Total Corporate FY 2024E Including Energy Storage Scenarios | |||
Observed market price case(a) | Recent pricing | Q4 2023 average | H2 2023 average |
Average lithium market price ($/kg LCE)(a) | |||
Net sales | |||
Adjusted EBITDA(b)(c) | |||
Weighted-average common shares outstanding (diluted)(d) | ~118 million | ~118 million | 135 - 139 million |
(a) | Price represents blend of relevant |
(b) | The company does not provide a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP, as the company is unable to estimate significant non-recurring or unusual items without unreasonable effort. See "Additional Information regarding Non-GAAP Measures" for more information. |
(c) | Presented under updated adjusted EBITDA definition as of 2024. FY23 adjusted EBITDA under updated definition would be |
(d) | Each quarter, Albemarle will report the more dilutive of either: 1) adding the underlying shares in the mandatory to the share count or 2) reducing Albemarle's net income to common shareholders by the mandatory dividend. The 20-day volume-weighted average common share price will be used in determining the underlying shares to be added to the share count. |
Third Quarter 2024 Results
In millions, except per share amounts | Q3 2024 | Q3 2023 | $ Change | % Change | |||
Net sales | $ 1,354.7 | $ 2,310.6 | $ (955.9) | (41.4) % | |||
Net (loss) income attributable to Albemarle Corporation | $ (1,069.0) | $ 302.5 | $ (1,371.5) | (453.4) % | |||
Adjusted EBITDA(a)(b) | $ 211.5 | $ 653.0 | $ (441.5) | (67.6) % | |||
Diluted (loss) earnings per share attributable to common shareholders | $ (9.45) | $ 2.57 | $ (12.02) | (467.7) % | |||
Non-recurring and other unusual items(a) | 7.90 | 0.17 | |||||
Adjusted diluted (loss) earnings per share attributable to common shareholders(a)(c) | $ (1.55) | $ 2.74 | $ (4.29) | (156.6) % |
(a) | See Non-GAAP Reconciliations for further details. |
(b) | For comparability, 2023 figures presented under adjusted EBITDA definition that the company adopted beginning in 2024. |
(c) | Totals may not add due to rounding. |
Net sales for the third quarter of 2024 were
The effective income tax rate for the third quarter of 2024 was (9.4)% compared to
Energy Storage Results
In millions | Q3 2024 | Q3 2023 | $ Change | % Change | |||
Net Sales | $ 767.3 | $ 1,697.2 | $ (929.9) | (54.8) % | |||
Adjusted EBITDA | $ 142.9 | $ 604.9 | $ (462.1) | (76.4) % |
Energy Storage net sales for the third quarter of 2024 were
Specialties Results
In millions | Q3 2024 | Q3 2023 | $ Change | % Change | |||
Net Sales | $ 342.4 | $ 352.7 | $ (10.3) | (2.9) % | |||
Adjusted EBITDA | $ 56.3 | $ 46.3 | $ 10.0 | 21.5 % |
Specialties net sales for the third quarter of 2024 were
Ketjen Results
In millions | Q3 2024 | Q3 2023 | $ Change | % Change | |||
Net Sales | $ 245.0 | $ 260.7 | $ (15.7) | (6.0) % | |||
Adjusted EBITDA | $ 35.5 | $ 15.2 | $ 20.3 | 134.0 % |
Ketjen net sales for the third quarter of 2024 were
Cash Flow and Capital Deployment
Year-to-date cash from operations of
Year-to-date capital expenditures of
Balance Sheet and Liquidity
As of September 30, 2024, Albemarle had estimated liquidity of approximately
Earnings Call
Date: | Thursday, November 7, 2024 |
Time: | 8:00 AM Eastern time |
Dial-in ( | 1-800-590-8290 |
Dial-in (International): | 1-240-690-8800 |
Conference ID: | ALBQ3 |
The company's earnings presentation and supporting material are available on Albemarle's website at https://investors.albemarle.com.
About Albemarle
Albemarle Corporation (NYSE: ALB) is a global leader in transforming essential resources into critical ingredients for mobility, energy, connectivity, and health. We partner to pioneer new ways to move, power, connect and protect with people and planet in mind. A reliable and high-quality global supply of lithium and bromine allow us to deliver advanced solutions for our customers. Learn more about how the people of Albemarle are enabling a more resilient world at albemarle.com and on X (formerly Twitter) @AlbemarleCorp.
Albemarle regularly posts information to www.albemarle.com, including notification of events, news, financial performance, investor presentations and webcasts, non-GAAP reconciliations, Securities and Exchange Commission ("SEC") filings and other information regarding the company, its businesses and the markets it serves.
Forward-Looking Statements
This press release contains statements concerning our expectations, anticipations and beliefs regarding the future, which constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on assumptions that we have made as of the date hereof and are subject to known and unknown risks and uncertainties, often contain words such as "anticipate," "believe," "estimate," "expect," "guidance," "intend," "may," "outlook," "scenario," "should," "would," and "will". Forward-looking statements may include statements regarding: our 2024 company and segment outlooks, including expected market pricing of lithium and spodumene and other underlying assumptions and outlook considerations; expected capital expenditure amounts and the corresponding impact on cash flow; market pricing of lithium carbonate equivalent and spodumene; plans and expectations regarding other projects and activities, cost reductions and accounting charges, and all other information relating to matters that are not historical facts. Factors that could cause Albemarle's actual results to differ materially from the outlook expressed or implied in any forward-looking statement include: changes in economic and business conditions; financial and operating performance of customers; timing and magnitude of customer orders; fluctuations in lithium market prices; production volume shortfalls; increased competition; changes in product demand; availability and cost of raw materials and energy; technological change and development; fluctuations in foreign currencies; changes in laws and government regulation; regulatory actions, proceedings, claims or litigation; cyber-security breaches, terrorist attacks, industrial accidents or natural disasters; political unrest; changes in inflation or interest rates; volatility in the debt and equity markets; acquisition and divestiture transactions; timing and success of projects; performance of Albemarle's partners in joint ventures and other projects; changes in credit ratings; and the other factors detailed from time to time in the reports Albemarle files with the SEC, including those described under "Risk Factors" in Albemarle's most recent Annual Report on Form 10-K and any subsequently filed Quarterly Reports on Form 10-Q, which are filed with the SEC and available on the investor section of Albemarle's website (investors.albemarle.com) and on the SEC's website at www.sec.gov. These forward-looking statements speak only as of the date of this press release. Albemarle assumes no obligation to provide any revisions to any forward-looking statements should circumstances change, except as otherwise required by securities and other applicable laws.
Albemarle Corporation and Subsidiaries Consolidated Statements of (Loss) Income (In Thousands Except Per Share Amounts) (Unaudited) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net sales | |||||||
Cost of goods sold | 1,458,726 | 2,255,662 | 4,221,487 | 5,371,077 | |||
Gross (loss) profit | (104,034) | 54,934 | (75,674) | 1,889,961 | |||
Selling, general and administrative expenses | 154,253 | 172,109 | 482,052 | 716,046 | |||
Restructuring charges and asset write-offs | 828,146 | 1,757 | 1,156,522 | 9,196 | |||
Research and development expenses | 22,397 | 21,082 | 66,699 | 62,972 | |||
Operating (loss) profit | (1,108,830) | (140,014) | (1,780,947) | 1,101,747 | |||
Interest and financing expenses | (47,760) | (29,332) | (120,916) | (81,686) | |||
Other (expenses) income, net | (22,256) | 11,182 | 61,311 | 147,628 | |||
(Loss) income before income taxes and equity in net income of unconsolidated investments | (1,178,846) | (158,164) | (1,840,552) | 1,167,689 | |||
Income tax expense (benefit) | 110,853 | (8,551) | 76,472 | 311,399 | |||
(Loss) income before equity in net income of unconsolidated investments | (1,289,699) | (149,613) | (1,917,024) | 856,290 | |||
Equity in net income of unconsolidated investments (net of tax) | 229,058 | 470,306 | 696,436 | 1,417,545 | |||
Net (loss) income | (1,060,641) | 320,693 | (1,220,588) | 2,273,835 | |||
Net income attributable to noncontrolling interests | (8,351) | (18,160) | (34,154) | (82,679) | |||
Net (loss) income attributable to Albemarle Corporation | (1,068,992) | 302,533 | (1,254,742) | 2,191,156 | |||
Mandatory convertible preferred stock dividends | (41,687) | — | (94,959) | — | |||
Net (loss) income attributable to Albemarle Corporation common shareholders | $ (1,110,679) | $ 302,533 | $ (1,349,701) | ||||
Basic (loss) earnings per share attributable to common shareholders | $ (9.45) | $ 2.58 | $ (11.49) | $ 18.68 | |||
Diluted (loss) earnings per share attributable to common shareholders | $ (9.45) | $ 2.57 | $ (11.49) | $ 18.60 | |||
Weighted-average common shares outstanding – basic | 117,535 | 117,349 | 117,505 | 117,304 | |||
Weighted-average common shares outstanding – diluted | 117,535 | 117,783 | 117,505 | 117,797 | |||
Albemarle Corporation and Subsidiaries Condensed Consolidated Balance Sheets (In Thousands) (Unaudited) | |||
September 30, | December 31, | ||
2024 | 2023 | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 1,664,519 | $ 889,900 | |
Trade accounts receivable | 749,792 | 1,213,160 | |
Other accounts receivable | 268,696 | 509,097 | |
Inventories | 1,657,688 | 2,161,287 | |
Other current assets | 328,915 | 443,475 | |
Total current assets | 4,669,610 | 5,216,919 | |
Property, plant and equipment | 12,376,369 | 12,233,757 | |
Less accumulated depreciation and amortization | 3,117,917 | 2,738,553 | |
Net property, plant and equipment | 9,258,452 | 9,495,204 | |
Investments | 1,179,598 | 1,369,855 | |
Other assets | 463,690 | 297,087 | |
Goodwill | 1,637,758 | 1,629,729 | |
Other intangibles, net of amortization | 246,078 | 261,858 | |
Total assets | $ 17,455,186 | $ 18,270,652 | |
LIABILITIES AND EQUITY | |||
Current liabilities: | |||
Accounts payable to third parties | $ 1,070,717 | $ 1,537,859 | |
Accounts payable to related parties | 152,093 | 550,186 | |
Accrued expenses | 513,122 | 544,835 | |
Current portion of long-term debt | 3,012 | 625,761 | |
Dividends payable | 61,262 | 46,666 | |
Income taxes payable | 110,514 | 255,155 | |
Total current liabilities | 1,910,720 | 3,560,462 | |
Long-term debt | 3,565,990 | 3,541,002 | |
Postretirement benefits | 25,959 | 26,247 | |
Pension benefits | 143,666 | 150,312 | |
Other noncurrent liabilities | 791,823 | 769,100 | |
Deferred income taxes | 526,367 | 558,430 | |
Commitments and contingencies | |||
Equity: | |||
Albemarle Corporation shareholders' equity: | |||
Common stock | 1,176 | 1,174 | |
Mandatory convertible preferred stock | 2,235,105 | — | |
Additional paid-in capital | 2,978,387 | 2,952,517 | |
Accumulated other comprehensive loss | (469,770) | (528,526) | |
Retained earnings | 5,495,697 | 6,987,015 | |
Total Albemarle Corporation shareholders' equity | 10,240,595 | 9,412,180 | |
Noncontrolling interests | 250,066 | 252,919 | |
Total equity | 10,490,661 | 9,665,099 | |
Total liabilities and equity | $ 17,455,186 | $ 18,270,652 | |
Albemarle Corporation and Subsidiaries Selected Consolidated Cash Flow Data (In Thousands) (Unaudited) | |||
Nine Months Ended September 30, | |||
2024 | 2023 | ||
Cash and cash equivalents at beginning of year | $ 889,900 | $ 1,499,142 | |
Cash flows from operating activities: | |||
Net (loss) income | (1,220,588) | 2,273,835 | |
Adjustments to reconcile net (loss) income to cash flows from operating activities: | |||
Depreciation and amortization | 425,532 | 285,801 | |
Non-cash restructuring and asset write-offs | 1,075,888 | — | |
Stock-based compensation and other | 24,443 | 29,465 | |
Equity in net income of unconsolidated investments (net of tax) | (696,436) | (1,417,545) | |
Dividends received from unconsolidated investments and nonmarketable securities | 348,358 | 1,939,225 | |
Pension and postretirement expense | 3,806 | 5,925 | |
Pension and postretirement contributions | (13,339) | (12,243) | |
Realized loss on investments in marketable securities | 33,746 | — | |
Unrealized loss (gain) on investments in marketable securities | 26,982 | (36,740) | |
Deferred income taxes | (112,777) | (182,764) | |
Working capital changes | 823,194 | (1,332,042) | |
Other, net | (17,415) | (129,377) | |
Net cash provided by operating activities | 701,394 | 1,423,540 | |
Cash flows from investing activities: | |||
Acquisitions, net of cash acquired | — | (43,207) | |
Capital expenditures | (1,330,062) | (1,465,193) | |
Sales (purchases) of marketable securities, net | 83,651 | (205,952) | |
Investments in equity investments and nonmarketable securities | (217) | (1,279) | |
Net cash used in investing activities | (1,246,628) | (1,715,631) | |
Cash flows from financing activities: | |||
Proceeds from issuance of mandatory convertible preferred stock | 2,236,750 | — | |
Repayments of long-term debt and credit agreements | (84,403) | — | |
Proceeds from borrowings of long-term debt and credit agreements | 84,403 | 300,000 | |
Other debt repayments, net | (629,434) | 172,791 | |
Dividends paid to common shareholders | (140,929) | (140,251) | |
Dividends paid to mandatory convertible preferred shareholders | (81,059) | — | |
Dividends paid to noncontrolling interests | (37,176) | (79,393) | |
Proceeds from exercise of stock options | 114 | 117 | |
Withholding taxes paid on stock-based compensation award distributions | (10,892) | (26,166) | |
Other | (2,758) | (191) | |
Net cash provided by financing activities | 1,334,616 | 226,907 | |
Net effect of foreign exchange on cash and cash equivalents | (14,763) | 167,710 | |
Increase in cash and cash equivalents | 774,619 | 102,526 | |
Cash and cash equivalents at end of period | $ 1,664,519 | $ 1,601,668 | |
Albemarle Corporation and Subsidiaries Consolidated Summary of Segment Results (In Thousands) (Unaudited) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net sales: | |||||||
Energy Storage | $ 767,291 | ||||||
Specialties | 342,376 | 352,722 | 993,041 | 1,142,802 | |||
Ketjen | 245,025 | 260,711 | 754,473 | 714,326 | |||
Total net sales | |||||||
Adjusted EBITDA: | |||||||
Energy Storage | $ 142,887 | $ 604,948 | $ 623,862 | ||||
Specialties | 56,273 | 46,307 | 155,629 | 268,665 | |||
Ketjen | 35,473 | 15,159 | 95,288 | 72,584 | |||
Total segment adjusted EBITDA | 234,633 | 666,414 | 874,779 | 3,678,969 | |||
Corporate | (23,135) | (13,442) | 14,315 | 1,949 | |||
Total adjusted EBITDA | $ 211,498 | $ 652,972 | $ 889,094 | ||||
See accompanying non-GAAP reconciliations below.
Additional Information regarding Non-GAAP Measures
It should be noted that adjusted net (loss) income attributable to Albemarle Corporation, adjusted net (loss) income attributable to Albemarle Corporation common shareholders, adjusted diluted (loss) earnings per share attributable to common shareholders, non-operating pension and other post-employment benefit ("OPEB") items per diluted share, non-recurring and other unusual items per diluted share, adjusted effective income tax rates, EBITDA, adjusted EBITDA (on a consolidated basis), EBITDA margin and adjusted EBITDA margin are financial measures that are not required by, or presented in accordance with, accounting principles generally accepted in
A description of other non-GAAP financial measures that Albemarle uses to evaluate its operations and financial performance, and reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP can be found on the following pages of this press release, which is also is available on Albemarle's website at https://investors.albemarle.com. The company does not provide a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP, as the company is unable to estimate significant non-recurring or unusual items without unreasonable effort. The amounts and timing of these items are uncertain and could be material to the company's results calculated in accordance with GAAP.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Non-GAAP Reconciliations
(Unaudited)
See below for a reconciliation of adjusted net (loss) income attributable to Albemarle Corporation, adjusted net (loss) income attributable to Albemarle Corporation common shareholders, EBITDA and adjusted EBITDA (on a consolidated basis), which are non-GAAP financial measures, to Net (loss) income attributable to Albemarle Corporation ("earnings"), the most directly comparable financial measure calculated and reported in accordance with GAAP. Adjusted net (loss) income attributable to Albemarle Corporation common shareholders is defined as net (loss) income after mandatory convertible preferred stock dividends, but before the non-recurring, other unusual and non-operating pension and other post-employment benefit (OPEB) items as listed below. The non-recurring and unusual items may include acquisition and integration related costs, gains or losses on sales of businesses, restructuring charges, facility divestiture charges, certain litigation and arbitration costs and charges, and other significant non-recurring items. EBITDA is defined as net (loss) income attributable to Albemarle Corporation before interest and financing expenses, income tax expense, and depreciation and amortization. Adjusted EBITDA is defined as EBITDA plus or minus the proportionate share of Windfield Holdings income tax expense, non-recurring, other unusual and non-operating pension and OPEB items as listed below.
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||
In thousands, except percentages and per share amounts | $ | % of | $ | % of | $ | % of | $ | % of | |||||||
Net (loss) income attributable to Albemarle Corporation | ( | ( | $ 2,191,156 | ||||||||||||
Add back: | |||||||||||||||
Non-operating pension and OPEB items (net of tax) | (344) | 386 | (1,031) | 1,141 | |||||||||||
Non-recurring and other unusual items (net of tax) | 928,771 | 19,674 | 1,203,313 | 210,094 | |||||||||||
Adjusted net (loss) income attributable to Albemarle Corporation | (140,565) | 322,593 | (52,460) | 2,402,391 | |||||||||||
Mandatory convertible preferred stock dividends | (41,687) | — | (94,959) | — | |||||||||||
Adjusted net (loss) income attributable to Albemarle Corporation common shareholders | ( | ( | $ 2,402,391 | ||||||||||||
Adjusted diluted (loss) earnings per share attributable to common shareholders | $ (1.55) | $ 2.74 | $ (1.25) | $ 20.39 | |||||||||||
Adjusted weighted-average common shares outstanding – diluted | 117,535 | 117,783 | 117,505 | 117,797 | |||||||||||
Net (loss) income attributable to Albemarle Corporation | ( | (78.9) % | 13.1 % | ( | (30.3) % | $ 2,191,156 | 30.2 % | ||||||||
Add back: | |||||||||||||||
Interest and financing expenses | 47,760 | 3.5 % | 29,332 | 1.3 % | 120,916 | 2.9 % | 81,686 | 1.1 % | |||||||
Income tax expense (benefit) | 110,853 | 8.2 % | (8,551) | (0.4) % | 76,472 | 1.8 % | 311,399 | 4.3 % | |||||||
Depreciation and amortization | 163,502 | 12.1 % | 105,445 | 4.6 % | 425,532 | 10.3 % | 285,801 | 3.9 % | |||||||
EBITDA | (746,877) | (55.1) % | 428,759 | 18.6 % | (631,822) | (15.2) % | 2,870,042 | 39.5 % | |||||||
Proportionate share of Windfield income tax expense | 99,523 | 7.3 % | 199,685 | 8.6 % | 292,992 | 7.1 % | 599,646 | 8.3 % | |||||||
Non-operating pension and OPEB items | (331) | — % | 620 | — % | (993) | — % | 1,833 | — % | |||||||
Non-recurring and other unusual items | 859,183 | 63.4 % | 23,908 | 1.0 % | 1,228,917 | 29.6 % | 209,397 | 2.9 % | |||||||
Adjusted EBITDA | 15.6 % | 28.3 % | 21.4 % | $ 3,680,918 | 50.7 % | ||||||||||
Net sales | $ 1,354,692 | $ 2,310,596 | $ 4,145,813 | $ 7,261,038 | |||||||||||
Non-operating pension and OPEB items, consisting of mark-to-market actuarial gains/losses, settlements/curtailments, interest cost and expected return on assets, are not allocated to Albemarle's operating segments and are included in the Corporate category. In addition, the company believes that these components of pension cost are mainly driven by market performance, and the company manages these separately from the operational performance of the company's businesses. In accordance with GAAP, these non-operating pension and OPEB items are included in Other income, net. Non-operating pension and OPEB items were as follows (in thousands):
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Interest cost | $ 8,523 | $ 9,054 | $ 25,529 | $ 27,091 | |||
Expected return on assets | (8,854) | (8,434) | (26,522) | (25,258) | |||
Total | $ (331) | $ 620 | $ (993) | $ 1,833 | |||
In addition to the non-operating pension and OPEB items disclosed above, the company has identified certain other items and excluded them from Albemarle's adjusted net income calculation for the periods presented. A listing of these items, as well as a detailed description of each follows below (per diluted share):
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Restructuring charges and asset write-offs(1) | $ 7.91 | $ 0.01 | $ 9.99 | $ 0.06 | |||
Acquisition and integration related costs(2) | — | 0.07 | 0.03 | 0.14 | |||
Loss (gain) in fair value of public equity securities(3) | 0.03 | 0.17 | 0.50 | (0.21) | |||
Legal accrual(4) | — | — | — | 1.82 | |||
Other(5) | (0.04) | (0.09) | (0.23) | (0.03) | |||
Tax related items(6) | — | 0.01 | (0.05) | — | |||
Total non-recurring and other unusual items | $ 7.90 | $ 0.17 | $ 10.24 | $ 1.78 | |||
(1) | The Company took several actions during the nine months ended September 30, 2024 as part of a broader effort that will focus on preserving its world-class resource advantages, optimizing its global conversion network, improving the Company's cost competitiveness and efficiency, reducing capital intensity and enhancing the Company's financial flexibility. Those actions included stopping construction of Kemerton Trains 3 and 4, as well as certain other capital projects, and placing Kemerton Train 2 in care and maintenance. As a result, the Company recorded restructuring charges as described above of | |
(2) | Costs related to the acquisition, integration and divestitures for various significant projects, recorded in Selling, general and administrative expenses for the three and nine months ended September 30, 2024 were | |
(3) | Losses of | |
(4) | Accrual of | |
(5) | Other adjustments for the three months ended September 30, 2024 included amounts recorded in: | |
• | Selling, general and administrative expenses - | |
• | Other (expenses) income, net - | |
After income taxes, these net gains totaled | ||
Other adjustments for the three months ended September 30, 2023 included amounts recorded in: | ||
• | Selling, general and administrative expenses - | |
• | Other (expenses) income, net - | |
After income taxes, these net gains totaled | ||
Other adjustments for the nine months ended September 30, 2024 included amounts recorded in: | ||
• | Cost of goods sold - | |
• | Selling, general and administrative expenses - | |
• | Other (expenses) income, net - | |
After income taxes, these net gains totaled | ||
Other adjustments for the nine months ended September 30, 2023 included amounts recorded in: | ||
• | Selling, general and administrative expenses - | |
• | Other (expenses) income, net - | |
After income taxes, these net gains totaled | ||
(6) | Included in Income tax expense for the three and nine months ended September 30, 2024 are discrete net tax benefits of | |
Included in Income tax expense for the three and nine months ended September 30, 2023 are discrete net tax expenses of | ||
See below for a reconciliation of the adjusted effective income tax rate, the non-GAAP financial measure, to the effective income tax rate, the most directly comparable financial measure calculated and reported in accordance with GAAP (in thousands, except percentages).
(Loss) Income | Income tax expense | Effective income tax | |||
Three months ended September 30, 2024 | |||||
As reported | $ (1,178,846) | $ 110,853 | (9.4) % | ||
Non-recurring, other unusual and non-operating pension and OPEB items | 858,852 | (69,575) | |||
As adjusted | $ (319,994) | $ 41,278 | (12.9) % | ||
Three months ended September 30, 2023 | |||||
As reported | $ (158,164) | $ (8,551) | 5.4 % | ||
Non-recurring, other unusual and non-operating pension and OPEB items | 24,528 | 4,468 | |||
As adjusted | $ (133,636) | $ (4,083) | 3.1 % | ||
Nine months ended September 30, 2024 | |||||
As reported | $ (1,840,552) | $ 76,472 | (4.2) % | ||
Non-recurring, other unusual and non-operating pension and OPEB items | 1,227,924 | 25,642 | |||
As adjusted | $ (612,628) | $ 102,114 | (16.7) % | ||
Nine months ended September 30, 2023 | |||||
As reported | $ 1,167,689 | $ 311,399 | 26.7 % | ||
Non-recurring, other unusual and non-operating pension and OPEB items | 211,230 | (5) | |||
As adjusted | $ 1,378,919 | $ 311,394 | 22.6 % |
As noted above, beginning in 2024, the company changed its definition of adjusted EBITDA for financial accounting purposes. The updated definition includes Albemarle's share of the pre-tax earnings of the Talison joint venture, whereas the prior definition included Albemarle's share of Talison earnings net of tax. See below for a reconciliation of adjusted EBITDA (on a consolidated basis), the non-GAAP financial measure, to Net income attributable to Albemarle Corporation ("earnings"), the most directly comparable financial measure calculated and reported in accordance with GAAP, as if it were presented under the new definition for the year ended December 31, 2023.
Net income attributable to Albemarle Corporation | $ 1,573,476 |
Depreciation and amortization | 429,944 |
Interest and financing expenses | 116,072 |
Income tax expense | 430,277 |
Proportionate share of Windfield income tax expense | 779,703 |
Gain on sale of business/interest in properties, net | (71,190) |
Acquisition and integration related costs | 26,767 |
Goodwill impairment | 6,765 |
Non-operating pension and OPEB items | (7,971) |
Mark-to-market gain on public equity securities | 44,732 |
Legal accrual | 218,510 |
Other | (1,097) |
Total adjusted EBITDA | $ 3,545,988 |
Media Contact: Peter Smolowitz, +1 (980) 308-6310, media@albemarle.com
Investor Relations Contact: +1 (980) 299-5700, invest@albemarle.com
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SOURCE Albemarle Corporation
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