Olin Announces Second Quarter 2024 Results

Rhea-AI Summary

Olin (NYSE: OLN) reported second quarter 2024 net income of $74.2 million, or $0.62 per diluted share, compared to $146.9 million in Q2 2023. Adjusted EBITDA was $278.1 million, down from $351.1 million in the previous year. Sales decreased to $1,644.0 million from $1,702.7 million in Q2 2023.

The company faced challenges, including Hurricane Beryl's impact on its Freeport, Texas facility, estimated to reduce Q3 2024 adjusted EBITDA by $100 million. Olin's Chlor Alkali Products and Vinyls segment saw lower earnings due to decreased caustic soda pricing, while Winchester segment earnings improved.

Olin repurchased 1.9 million shares for $106.0 million in Q2 2024 and had $0.8 billion available under its share repurchase authorization. The company ended the quarter with a net debt of $2.7 billion and a net debt to adjusted EBITDA ratio of 2.6 times.

Positive

• Share repurchases of $106.0 million in Q2 2024
• Winchester segment earnings increased by $5.6 million year-over-year
• 15% sequential improvement in adjusted EBITDA from Q1 to Q2 2024
• Available liquidity of approximately $1.0 billion as of June 30, 2024

Negative

• Net income decreased from $146.9 million in Q2 2023 to $74.2 million in Q2 2024
• Adjusted EBITDA declined from $351.1 million in Q2 2023 to $278.1 million in Q2 2024
• Sales decreased by 3.4% year-over-year to $1,644.0 million in Q2 2024
• Hurricane Beryl expected to reduce Q3 2024 adjusted EBITDA by approximately $100 million
• Chlor Alkali Products and Vinyls segment earnings decreased by $80.8 million year-over-year
• Net debt increased by $229.0 million in the first half of 2024

Insights

Financial Analyst

Olin 's Q2 2024 results present a mixed picture with some concerning trends. Net income dropped to $74.2 million ($0.62 per diluted share) from $146.9 million ($1.13 per diluted share) in Q2 2023, a significant 49.5% decrease. Adjusted EBITDA also declined by 20.8% to $278.1 million from $351.1 million in the previous year.

The Chlor Alkali Products and Vinyls segment, Olin's largest revenue generator, saw a 8.2% decrease in sales and a substantial 44.9% drop in earnings. This was primarily due to lower caustic soda pricing, which is a concern as it's a key product for the company. The Epoxy segment also struggled, reporting a loss of $3.0 million compared to a $0.5 million loss in Q2 2023.

On a positive note, the Winchester segment showed improvement with a 10.7% increase in sales and an 8.7% rise in earnings, driven by higher international military sales and the acquisition of White Flyer. However, this segment represents a smaller portion of Olin's overall business.

The company's share repurchase program remains active, with $106.0 million spent in Q2. While this may support the stock price, it's worth noting that the net debt increased by $229.0 million in the first half of 2024, primarily due to seasonal working capital needs.

Looking ahead, the impact of Hurricane Beryl on Olin's Freeport, Texas facility is expected to reduce Q3 2024 adjusted EBITDA by approximately $100 million. This, combined with slower-than-expected demand improvement in the Chlor Alkali Products and Vinyls business, suggests continued challenges in the near term.

Market Research Analyst

Olin's Q2 2024 results reflect broader market dynamics affecting the chemical industry. The decline in caustic soda pricing, which significantly impacted the Chlor Alkali Products and Vinyls segment, suggests oversupply or weak demand in key end-markets such as alumina, pulp and paper and soaps and detergents.

The Epoxy segment's continued losses point to ongoing challenges in construction and automotive markets, which are major consumers of epoxy resins. This aligns with recent economic indicators showing softness in these sectors.

Interestingly, the Winchester segment's performance, bolstered by increased military sales, indicates a shift in the ammunition market. The growth in international military sales could be tied to geopolitical tensions, while the decline in commercial ammunition sales might reflect changing consumer behavior or inventory adjustments in the retail channel.

The acquisition of White Flyer in Q4 2023 appears to be a strategic move to diversify Winchester's product portfolio, potentially providing some insulation against fluctuations in ammunition demand.

Management's comments on slower-than-expected demand improvement in the Chlor Alkali Products and Vinyls business is particularly noteworthy. This suggests that the anticipated economic recovery may be more gradual than previously thought, which could have implications not just for Olin but for the broader chemical industry and related sectors.

The impact of Hurricane Beryl on Olin's Freeport facility underscores the vulnerability of Gulf Coast chemical operations to extreme weather events, a risk that may become more pronounced with climate change. This could lead to increased focus on resilience and disaster preparedness in the industry.

Highlights

• Second quarter 2024 net income of $74.2 million, or $0.62 per diluted share
• Quarterly adjusted EBITDA of $278.1 million
• Share repurchases of $106.0 million in second quarter 2024

CLAYTON, Mo., July 25, 2024 /PRNewswire/ -- Olin Corporation (NYSE: OLN) announced financial results for the second quarter ended June 30, 2024. Second quarter 2024 reported net income was $74.2 million, or $0.62 per diluted share, which compares to second quarter 2023 reported net income of $146.9 million, or $1.13 per diluted share. Second quarter 2024 adjusted EBITDA of $278.1 million excludes depreciation and amortization expense of $129.0 million and restructuring charges of $6.8 million. Second quarter 2023 adjusted EBITDA was $351.1 million. Sales in the second quarter 2024 were $1,644.0 million, compared to $1,702.7 million in the second quarter 2023.

Ken Lane, President and Chief Executive Officer, said, "During the second quarter, the Olin team delivered a 15% sequential improvement in adjusted EBITDA. Our Chlor Alkali Products and Vinyls business benefited from seasonal demand improvement in the second quarter. The Epoxy business continued to improve sequentially as well, delivering higher margins and lower costs from our ongoing delivery of previously announced restructuring plans. At the same time, our Winchester business achieved higher military ammunition shipments and military project revenue, while commercial ammunition shipments were sequentially lower with higher propellant costs, resulting in a relatively flat performance versus the first quarter, as expected."

Lane continued, "As a result of Hurricane Beryl, Olin's operations at its Freeport, Texas facility were disrupted in early July. Olin has safely returned many Freeport plants to operation. Wind damage to ancillary equipment has prevented the remainder from resuming production. Once this critical equipment is restored, those remaining assets, including our vinyl chloride monomer and phenol/acetone plants, will be restarted. We currently estimate that Olin's third quarter 2024 adjusted EBITDA will be reduced by approximately $100 million due to incremental costs to restore operations, unabsorbed fixed manufacturing costs, and reduced profit from lost sales associated with the storm. Before considering the effects of Hurricane Beryl, we had anticipated our Chemical businesses' third quarter 2024 adjusted EBITDA would have been comparable to second quarter 2024. We expect our Winchester business third quarter results to improve from second quarter levels with seasonally stronger commercial ammunition demand and higher military shipments and project revenue."

Commenting on the full year outlook Lane continued, "The anticipated improvement in demand for our Chlor Alkali Products and Vinyls business has been slower to develop than expected earlier this year. Based on our current outlook and before considering the effect of Hurricane Beryl, we believe Olin's second half 2024 adjusted EBITDA would have been comparable to first half 2024. We will continue to return value to our shareholders, as we maintain our disciplined capital allocation strategy, supported by our strong financial foundation and sustainable cash flow."

SEGMENT REPORTING

Olin defines segment earnings as income (loss) before interest expense, interest income, other operating income (expense), non-operating pension income, other income, and income taxes.

CHLOR ALKALI PRODUCTS AND VINYLS

Chlor Alkali Products and Vinyls sales for the second quarter 2024 were $920.3 million, compared to $1,002.3 million in the second quarter 2023. Second quarter 2024 segment earnings were $99.3 million, compared to $180.1 million in the second quarter 2023. The $80.8 million decrease in segment earnings was primarily due to lower caustic soda pricing partially offset by decreased costs associated with products purchased from other parties, higher volumes, and lower raw material and operating costs. The Chlor Alkali Products and Vinyls second quarter 2023 segment sales and results were negatively impacted by the maintenance turnaround and subsequent operating issues with the vinyl chloride monomer plant at the Freeport, Texas facility resulting in higher costs and reduced profit from lost sales.  Chlor Alkali Products and Vinyls second quarter 2024 results included depreciation and amortization expense of $105.8 million compared to $113.3 million in the second quarter 2023.

EPOXY

Epoxy sales for the second quarter 2024 were $317.7 million, compared to $333.8 million in the second quarter 2023. The decrease in sales was primarily due to lower product pricing, partially offset by improved volumes. Second quarter 2024 segment loss was ($3.0) million, compared to segment loss of ($0.5) million in the second quarter 2023. The $2.5 million decrease in segment results was primarily due to lower pricing, partially offset by increased volumes and lower raw material and operating costs. Epoxy second quarter 2024 results included depreciation and amortization expense of $13.4 million compared to $15.2 million in the second quarter 2023.

WINCHESTER

In fourth quarter 2023, Olin completed the acquisition of the White Flyer business, which was included in the Winchester segment. White Flyer designs, manufactures and sells recreational trap, skeet, international and sporting clay targets. Winchester sales for the second quarter 2024 were $406.0 million, compared to $366.6 million in the second quarter 2023. The increase in sales was primarily due to higher international military sales, military project revenue, and White Flyer sales, partially offset by lower commercial ammunition sales. Second quarter 2024 segment earnings were $70.3 million, compared to $64.7 million in the second quarter 2023. The $5.6 million increase in segment earnings was primarily due to White Flyer earnings and higher military shipments and military project revenue, partially offset by lower commercial ammunition shipments and pricing and higher propellant costs. Winchester second quarter 2024 results included depreciation and amortization expense of $8.3 million compared to $6.3 million in the second quarter 2023.

CORPORATE AND OTHER COSTS

Second quarter 2024 charges to income for environmental investigatory and remedial activities were $6.4 million compared to $13.0 million in the second quarter 2023. The charges relate primarily to future remedial activities associated with past manufacturing operations.

Other corporate and unallocated costs in the second quarter of 2024 decreased $5.4 million compared to second quarter 2023 primarily due to lower incentive costs, including mark-to-market on stock-based compensation, lower legal-related costs, and a favorable foreign currency impact.

LIQUIDITY AND SHARE REPURCHASES

The cash balance on June 30, 2024, was $182.1 million. Olin ended the second quarter 2024 with net debt of approximately $2.7 billion and a net debt to adjusted EBITDA ratio of 2.6 times. During the first half 2024, net debt increased by $229.0 million, primarily driven by typical seasonal working capital. The increase in working capital was $166.3 million in first half 2024. On June 30, 2024, Olin had approximately $1.0 billion of available liquidity.

During second quarter 2024, approximately 1.9 million shares of common stock were repurchased at a cost of $106.0 million. On June 30, 2024, Olin had approximately $0.8 billion available under its share repurchase authorization.

CONFERENCE CALL INFORMATION

Olin senior management will host a conference call to discuss second quarter 2024 financial results at 9:00 a.m. Eastern time on Friday, July 26, 2024. Remarks will be followed by a question-and-answer session. Associated slides, which will be available the evening before the call, and the conference call webcast will be accessible via Olin's website, www.olin.com, under the second quarter conference call icon. An archived replay of the webcast will also be available in the Investor Relations section of Olin's website beginning at 12:00 p.m. Eastern time. A final transcript of the call will be posted the next business day.

COMPANY DESCRIPTION

Olin Corporation is a leading vertically integrated global manufacturer and distributor of chemical products and a leading U.S. manufacturer of ammunition. The chemical products produced include chlorine and caustic soda, vinyls, epoxies, chlorinated organics, bleach, hydrogen, and hydrochloric acid. Winchester's principal manufacturing facilities produce and distribute sporting ammunition, law enforcement ammunition, reloading components, small caliber military ammunition and components, industrial cartridges, and clay targets.

Visit www.olin.com for more information on Olin.

FORWARD-LOOKING STATEMENTS

This communication includes forward-looking statements. These statements relate to analyses and other information that are based on management's beliefs, certain assumptions made by management, forecasts of future results, and current expectations, estimates and projections about the markets and economy in which we and our various segments operate. The statements contained in this communication that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties.

We have used the words "anticipate," "intend," "may," "expect," "believe," "should," "plan," "outlook," "project," "estimate," "forecast," "optimistic," "target," and variations of such words and similar expressions in this communication to identify such forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the Company's intent to repurchase, from time to time, the Company's common stock. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions, which are difficult to predict and many of which are beyond our control. Therefore, actual outcomes and results may differ materially from those matters expressed or implied in such forward-looking statements. We undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise. The payment of cash dividends is subject to the discretion of our board of directors and will be determined in light of then-current conditions, including our earnings, our operations, our financial conditions, our capital requirements and other factors deemed relevant by our board of directors. In the future, our board of directors may change our dividend policy, including the frequency or amount of any dividend, in light of then-existing conditions.

The risks, uncertainties and assumptions involved in our forward-looking statements, many of which are discussed in more detail in our filings with the SEC, including without limitation the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2023, and our Quarterly Reports on Form 10-Q and other reports furnished or filed with the SEC, include, but are not limited to, the following:

Business, Industry and Operational Risks

• sensitivity to economic, business and market conditions in the United States and overseas, including economic instability or a downturn in the sectors served by us;
• declines in average selling prices for our products and the supply/demand balance for our products, including the impact of excess industry capacity or an imbalance in demand for our chlor alkali products;
• unsuccessful execution of our strategic operating model, which prioritizes Electrochemical Unit (ECU) margins over sales volumes;
• failure to identify, attract, develop, retain and motivate qualified employees throughout the organization and ability to manage executive officer and other key senior management transitions;
• failure to control costs and inflation impacts or failure to achieve targeted cost reductions;
• our reliance on a limited number of suppliers for specified feedstock and services and our reliance on third-party transportation;
• the occurrence of unexpected manufacturing interruptions and outages, including those occurring as a result of labor disruptions and production hazards;
• exposure to physical risks associated with climate-related events or increased severity and frequency of severe weather events;
• availability of and/or higher-than-expected costs of raw material, energy, transportation, and/or logistics;
• the failure or an interruption, including cyber-attacks, of our information technology systems;
• our inability to complete future acquisitions or joint venture transactions or successfully integrate them into our business;
• risks associated with our international sales and operations, including economic, political or regulatory changes;
• our indebtedness and debt service obligations;
• weak industry conditions affecting our ability to comply with the financial maintenance covenants in our senior credit facility;
• adverse conditions in the credit and capital markets, limiting or preventing our ability to borrow or raise capital;
• the effects of any declines in global equity markets on asset values and any declines in interest rates or other significant assumptions used to value the liabilities in, and funding of, our pension plans;
• our long-range plan assumptions not being realized, causing a non-cash impairment charge of long-lived assets;

Legal, Environmental and Regulatory Risks

• changes in, or failure to comply with, legislation or government regulations or policies, including changes regarding our ability to manufacture or use certain products and changes within the international markets in which we operate;
• new regulations or public policy changes regarding the transportation of hazardous chemicals and the security of chemical manufacturing facilities;
• unexpected outcomes from legal or regulatory claims and proceedings;
• costs and other expenditures in excess of those projected for environmental investigation and remediation or other legal proceedings;
• various risks associated with our Lake City U.S. Army Ammunition Plant contract and performance under other governmental contracts; and
• failure to effectively manage environmental, social and governance (ESG) issues and related regulations, including climate change and sustainability.

All of our forward-looking statements should be considered in light of these factors. In addition, other risks and uncertainties not presently known to us or that we consider immaterial could affect the accuracy of our forward-looking statements.

2024-11

 

Olin Corporation
Consolidated Statements of Operations (a)
		Three Months			Six Months
		Ended June 30,			Ended June 30,
(In millions, except per share amounts)		2024	2023		2024	2023
Sales		$  1,644.0	$  1,702.7		$  3,279.3	$  3,547.0
Operating Expenses:
Cost of Goods Sold		1,406.2	1,392.6		2,834.2	2,834.3
Selling and Administrative		94.6	101.2		196.5	213.0
Restructuring Charges (b)		6.8	19.2		15.1	80.1
Other Operating Income (c)		-	27.0		0.2	27.5
Operating Income		136.4	216.7		233.7	447.1
Interest Expense		46.6	45.3		91.2	87.7
Interest Income		0.9	1.1		1.7	2.2
Non-operating Pension Income		5.9	5.4		12.7	11.1
Income before Taxes		96.6	177.9		156.9	372.7
Income Tax Provision		24.3	33.2		36.8	74.0
Net Income		72.3	144.7		120.1	298.7
Net Loss Attributable to Noncontrolling Interests		(1.9)	(2.2)		(2.7)	(4.5)
Net Income Attributable to Olin Corporation		$       74.2	$     146.9		$     122.8	$     303.2
Net Income Attributable to Olin Corporation per Common Share:
Basic		$       0.63	$       1.15		$       1.03	$       2.35
Diluted		$       0.62	$       1.13		$       1.01	$       2.29
Dividends per Common Share		$       0.20	$       0.20		$       0.40	$       0.40
Average Common Shares Outstanding - Basic		118.5	127.4		119.1	129.2
Average Common Shares Outstanding - Diluted		120.2	130.4		121.0	132.4

(a)	Unaudited.
(b)	Restructuring charges for the three and six months ended June 30, 2023 were primarily associated with our actions to configure our global Epoxy asset footprint to optimize the most productive and cost effective assets to support our strategic operating model, of which $4.9 million and $17.7 million, respectively, were non-cash impairment charges for equipment and facilities.
(c)	Other operating income for both the three and six months ended June 30, 2023 included a gain of $27.0 million for the sale of Olin's domestic private trucking fleet and operations.

 

Olin Corporation
Segment Information (a)
		Three Months				Six Months
		Ended June 30,				Ended June 30,
(In millions)		2024		2023		2024		2023
Sales:
Chlor Alkali Products and Vinyls		$     920.3		$  1,002.3		$ 1,804.9		$ 2,119.4
Epoxy		317.7		333.8		659.0		694.5
Winchester		406.0		366.6		815.4		733.1
Total Sales		$  1,644.0		$  1,702.7		$ 3,279.3		$ 3,547.0
Income before Taxes:
Chlor Alkali Products and Vinyls		$       99.3		$     180.1		$    175.9		$    426.0
Epoxy		(3.0)		(0.5)		(14.8)		20.9
Winchester		70.3		64.7		142.5		125.7
Corporate/Other:
Environmental Expense		(6.4)		(13.0)		(12.2)		(16.2)
Other Corporate and Unallocated Costs		(17.0)		(22.4)		(42.8)		(56.7)
Restructuring Charges (b)		(6.8)		(19.2)		(15.1)		(80.1)
Other Operating Income (c)		-		27.0		0.2		27.5
Interest Expense		(46.6)		(45.3)		(91.2)		(87.7)
Interest Income		0.9		1.1		1.7		2.2
Non-operating Pension Income		5.9		5.4		12.7		11.1
Income before Taxes		$       96.6		$     177.9		$    156.9		$    372.7

(a)	Unaudited.
(b)	Restructuring charges for both the three and six months ended June 30, 2023 were primarily associated with our actions to configure our global Epoxy asset footprint to optimize the most productive and cost effective assets to support our strategic operating model, of which $4.9 million and $17.7 million, respectively, were non-cash impairment charges for equipment and facilities.
(c)	Other operating income for both the three and six months ended June 30, 2023 included a gain of $27.0 million for the sale of Olin's domestic private trucking fleet and operations.

 

Olin Corporation
Consolidated Balance Sheets (a)
		June 30,		December 31,		June 30,
(In millions, except per share data)		2024		2023		2023
Assets:
Cash and Cash Equivalents		$           182.1		$           170.3		$           161.1
Accounts Receivable, Net		903.6		874.7		869.8
Income Taxes Receivable		17.7		15.3		32.8
Inventories, Net		872.9		858.8		1,081.2
Other Current Assets		82.0		54.1		53.3
Total Current Assets		2,058.3		1,973.2		2,198.2
Property, Plant and Equipment
(Less Accumulated Depreciation of $5,009.8, $4,826.3 and $4,636.9)		2,395.1		2,519.6		2,550.6
Operating Lease Assets, Net		321.2		344.7		335.7
Deferred Income Taxes		91.5		87.4		82.6
Other Assets		1,144.8		1,118.5		1,108.6
Intangibles, Net		226.3		245.8		255.9
Goodwill		1,423.4		1,424.0		1,420.9
Total Assets		$        7,660.6		$        7,713.2		$        7,952.5
Liabilities and Shareholders' Equity:
Current Installments of Long-term Debt		$           121.8		$             78.8		$               9.0
Accounts Payable		779.1		775.4		750.0
Income Taxes Payable		122.5		154.7		139.6
Current Operating Lease Liabilities		67.1		69.3		70.2
Accrued Liabilities		348.8		450.0		426.9
Total Current Liabilities		1,439.3		1,528.2		1,395.7
Long-term Debt		2,789.1		2,591.3		2,717.3
Operating Lease Liabilities		261.0		283.1		273.6
Accrued Pension Liability		201.8		225.8		225.4
Deferred Income Taxes		467.9		476.2		505.9
Other Liabilities		332.2		340.3		363.0
Total Liabilities		5,491.3		5,444.9		5,480.9
Commitments and Contingencies
Shareholders' Equity:
Common Stock, $1.00 Par Value Per Share; Authorized 240.0 Shares;
Issued and Outstanding 117.5, 120.2 and 125.8 Shares		117.5		120.2		125.8
Additional Paid-in Capital		-		24.8		313.7
Accumulated Other Comprehensive Loss		(474.0)		(496.3)		(483.4)
Retained Earnings		2,492.6		2,583.7		2,475.9
Olin Corporation's Shareholders' Equity		2,136.1		2,232.4		2,432.0
Noncontrolling Interests		33.2		35.9		39.6
Total Equity		2,169.3		2,268.3		2,471.6
Total Liabilities and Equity		$        7,660.6		$        7,713.2		$        7,952.5

(a)	Unaudited.

 

Olin Corporation
Consolidated Statements of Cash Flows (a)
		Six Months Ended
		June 30,
(In millions)		2024		2023
Operating Activities:
Net Income		$      120.1		$      298.7
Depreciation and Amortization		258.7		273.9
Gains on Disposition of Property, Plant and Equipment		-		(27.0)
Stock-based Compensation		6.4		8.4
Write-off of Equipment and Facility included in Restructuring Charges		-		17.7
Deferred Income Taxes		(23.3)		(27.7)
Qualified Pension Plan Contributions		(0.8)		(1.5)
Qualified Pension Plan Income		(11.7)		(9.9)
Changes in Assets and Liabilities:
Receivables		(37.4)		52.8
Income Taxes Receivable/Payable		(30.9)		14.3
Inventories		(19.3)		(137.9)
Other Current Assets		(14.9)		(1.8)
Accounts Payable and Accrued Liabilities		(63.8)		(141.1)
Other Assets		(18.2)		(13.4)
Other Noncurrent Liabilities		2.7		43.1
Other Operating Activities		4.0		(5.6)
Net Operating Activities		171.6		343.0
Investing Activities:
Capital Expenditures		(100.8)		(128.8)
Payments under Other Long-term Supply Contracts		(46.7)		(29.6)
Proceeds from Disposition of Property, Plant and Equipment		-		28.8
Other Investing Activities		(2.9)		(1.0)
Net Investing Activities		(150.4)		(130.6)
Financing Activities:
Long-term Debt Borrowings, Net		238.9		143.7
Common Stock Repurchased and Retired		(211.4)		(393.0)
Stock Options Exercised		21.7		11.9
Employee Taxes Paid for Share-based Payment Arrangements		(10.5)		-
Dividends Paid		(47.6)		(51.8)
Contributions Received from Noncontrolling Interests		-		44.1
Net Financing Activities		(8.9)		(245.1)
Effect of Exchange Rate Changes on Cash and Cash Equivalents		(0.5)		(0.2)
Net Increase (Decrease) in Cash and Cash Equivalents		11.8		(32.9)
Cash and Cash Equivalents, Beginning of Year		170.3		194.0
Cash and Cash Equivalents, End of Period		$      182.1		$      161.1

(a)	Unaudited.

 

Olin Corporation

Non-GAAP Financial Measures - Adjusted EBITDA (a)

Olin's definition of Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) is net income (loss) plus an add-back for depreciation and amortization, interest expense (income), income tax provision (benefit), other expense (income), restructuring charges (income) and certain other non-recurring items. Adjusted EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors as a supplemental financial measure to assess the financial performance without regard to financing methods, capital structures, taxes or historical cost basis. The use of non-GAAP financial measures is not intended to replace any measures of performance determined in accordance with GAAP and Adjusted EBITDA presented may not be comparable to similarly titled measures of other companies. Reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures are omitted from this release because Olin is unable to provide such reconciliations without the use of unreasonable efforts. This inability results from the inherent difficulty in forecasting generally and quantifying certain projected amounts that are necessary for such reconciliations. In particular, sufficient information is not available to calculate certain adjustments required for such reconciliations, including interest expense (income), income tax provision (benefit), other expense (income) and restructuring charges (income). Because of our inability to calculate such adjustments, forward-looking net income guidance is also omitted from this release. We expect these adjustments to have a potentially significant impact on our future GAAP financial results.

		Three Months		Six Months
		Ended June 30,		Ended June 30,
(In millions)		2024	2023	2024	2023
Reconciliation of Net Income to Adjusted EBITDA:
Net Income		$        72.3	$      144.7	$      120.1	$      298.7
Add Back:
Interest Expense		46.6	45.3	91.2	87.7
Interest Income		(0.9)	(1.1)	(1.7)	(2.2)
Income Tax Provision		24.3	33.2	36.8	74.0
Depreciation and Amortization		129.0	136.8	258.7	273.9
EBITDA		271.3	358.9	505.1	732.1
Add Back:
Restructuring Charges		6.8	19.2	15.1	80.1
Certain Non-recurring Items (b)		-	(27.0)	-	(27.0)
Adjusted EBITDA		$      278.1	$      351.1	$      520.2	$      785.2

(a)	Unaudited.
(b)	Certain non-recurring items for both the three and six months ended June 30, 2023 included a gain of $27.0 million for the sale of Olin's domestic private trucking fleet and operations.

 

Olin Corporation

Non-GAAP Financial Measures - Net Debt to Adjusted EBITDA (a)

Olin's definition of Net Debt to Adjusted EBITDA is Net Debt divided by Adjusted EBITDA. Net Debt at the end of any reporting period is defined as the sum of our current installments of long-term debt and long-term debt, less cash and cash equivalents. Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) is net income (loss) plus an add-back for depreciation and amortization, interest expense (income), income tax provision (benefit), other expense (income), restructuring charges (income) and certain other non-recurring items. Net Debt to Adjusted EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors as a measure of our ability to manage our indebtedness. The use of non-GAAP financial measures is not intended to replace any measures of indebtedness or liquidity determined in accordance with GAAP and Net Debt or Net Debt to Adjusted EBITDA presented may not be comparable to similarly titled measures of other companies.

		June 30,		December 31,		June 30,
(In millions)		2024		2023		2023
Current Installments of Long-term Debt		$          121.8		$            78.8		$              9.0
Long-term Debt		2,789.1		2,591.3		2,717.3
Total Debt		2,910.9		2,670.1		2,726.3
Less: Cash and Cash Equivalents		(182.1)		(170.3)		(161.1)
Net Debt		$       2,728.8		$       2,499.8		$       2,565.2
Trailing Twelve Months Adjusted EBITDA (b)		$       1,045.1		$       1,310.1		$       1,774.8
Net Debt to Adjusted EBITDA		2.6		1.9		1.4

(a)	Unaudited.
(b)	Trailing Twelve Months Adjusted EBITDA as of June 30, 2024 is calculated as the six months ended June 30, 2024 plus the year ended December 31, 2023 less the six months ended June 30, 2023. Trailing Twelve Months Adjusted EBITDA as of June 30, 2023 is calculated as the six months ended June 30, 2023 plus the year ended December 31, 2022 less the six months ended June 30, 2022.

 

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SOURCE Olin Corporation

FAQ

What was Olin's (OLN) net income for Q2 2024?

Olin (OLN) reported a net income of $74.2 million, or $0.62 per diluted share, for the second quarter of 2024.

How much did Olin (OLN) spend on share repurchases in Q2 2024?

Olin (OLN) repurchased approximately 1.9 million shares of common stock at a cost of $106.0 million during the second quarter of 2024.

What was the impact of Hurricane Beryl on Olin's (OLN) Q3 2024 outlook?

Olin (OLN) estimates that Hurricane Beryl's impact on its Freeport, Texas facility will reduce its third quarter 2024 adjusted EBITDA by approximately $100 million.

How did Olin's (OLN) Chlor Alkali Products and Vinyls segment perform in Q2 2024?

Olin's Chlor Alkali Products and Vinyls segment earnings decreased by $80.8 million year-over-year to $99.3 million in Q2 2024, primarily due to lower caustic soda pricing.