Albemarle Reports First Quarter 2024 Results

Die Albemarle Corporation stellt Chemikalien her. © Image Source / DigitalVision / Getty Images https://www.gettyimages.de/

PR Newswire

CHARLOTTE, N.C., May 1, 2024

CHARLOTTE, N.C., May 1, 2024 /PRNewswire/ -- Albemarle Corporation (NYSE: ALB), a global leader in providing essential elements for mobility, energy, connectivity and health, today announced its results for the first quarter ended March 31, 2024.

First-Quarter 2024 and Recent Highlights
(Unless otherwise stated, all percentage changes represent year-over-year comparisons)

Net sales of $1.4 billion, driven by Energy Storage volume growth as projects ramp
Net income of $2 million, or ($0.08)^(a) per diluted share attributable to common shareholders
Adjusted diluted EPS attributable to common shareholders of $0.26
Adjusted EBITDA^(b) of $291 million
On track to deliver more than $280 million target in productivity benefits in 2024; in Q1, delivered over $90 million in productivity and restructuring cost savings
Conducted successful bidding events for spodumene concentrate and lithium carbonate, designed to promote price transparency and discovery
Achieved 50% operating rate milestone at Kemerton I; commissioning at Meishan and ramp of the Salar Yield Improvement Project continue to progress well
Reaffirmed FY 2024 corporate outlook considerations, including ranges based on lithium market price scenarios

(a)

After mandatory convertible preferred stock dividends

(b)

Beginning in 2024, Adjusted EBITDA definition includes Albemarle's share of the pre-tax earnings of the Talison joint venture

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"In the first quarter, our team demonstrated agility in dynamic market conditions by continuing to deliver solid volumetric growth, ramping new conversion facilities, and executing cost reduction and productivity improvements," said Kent Masters, Albemarle's chairman and CEO. "We have strengthened our competitive position, enhanced our financial flexibility, and started to increase lithium market price transparency. Our actions best position us to serve our core end-markets today and for the future." Masters added, "We remain focused on disciplined capital allocation to deliver profitable organic growth and value for all stakeholders."

2024 Total Corporate Outlook Considerations
The company maintains its prior full-year outlook, which is based on three lithium market price scenarios.

	Total Corporate FY 2024E Including Energy Storage Scenarios
Observed market price case^(a)	YE 2023	Q4 2023 average	H2 2023 average
Average lithium market price ($/kg LCE)^(a)	~$15	~$20	~$25
Net sales	$5.5 - $6.2 billion	$6.1 - $6.8 billion	$6.9 - $7.6 billion
Adjusted EBITDA^(b)(c)	$0.9 - $1.2 billion	$1.6 - $1.8 billion	$2.3 - $2.6 billion


(a)	Price represents blend of relevant Asia and China market indices for the periods referenced.
(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 $3.5B. See Non-GAAP Reconciliations for further details.

2024 Other Corporate Outlook Considerations
Following the company's public offering of depository shares representing an interest in its mandatory convertible preferred stock, interest and financing expenses are expected to be at the low end of the previous range of $180 to $220 million. The change in weighted-average common shares outstanding (diluted) reflects the recently issued shares of mandatory convertible preferred stock on an as-converted basis. The change to the adjusted effective tax rate range is related to geographic income mix and is dependent on the assumption of lithium market price. All other corporate outlook considerations are unchanged.

	Other Corporate FY 2024E
Capital expenditures	$1.6 - $1.8 billion
Depreciation and amortization	$580 - $660 million
Adjusted effective tax rate	(5%) - 27%
Corporate costs	$120 - $150 million
Interest and financing expenses	$180 - $210 million
Weighted-average common shares outstanding (diluted)^(d)	135 - 139 million


(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.

First Quarter 2024 Results

In millions, except per share amounts	Q1 2024	Q1 2023	$ Change	% Change
Net sales	$ 1,360.7	$ 2,580.3	$ (1,219.5)	(47.3) %
Net income attributable to Albemarle Corporation	$ 2.4	$ 1,238.6	$ (1,236.1)	(99.8) %
Adjusted EBITDA^(a)(b)	$ 291.2	$ 1,761.7	$ (1,470.5)	(83.5) %
Diluted (loss) earnings per share attributable to common shareholders	$ (0.08)	$ 10.51	$ (10.59)	(100.8) %
Non-recurring and other unusual items^(a)	0.34	(0.19)
Adjusted diluted earnings per share attributable to common shareholders^(a)(c)	$ 0.26	$ 10.32	$ (10.06)	(97.5) %


(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 first quarter of 2024 were $1.4 billion compared to $2.6 billion for the prior-year quarter, a year-over-year decline of 47% that was driven primarily by lower pricing in Energy Storage. Net income attributable to Albemarle of $2 million decreased by $1.2 billion and adjusted EBITDA of $291 million declined by $1.5 billion from the prior-year quarter. The decline in earnings was primarily due to lower lithium market pricing, as well as additional margin compression due to inventory timing and reduced equity earnings at the Talison joint venture, which more than offset favorable volumes.

The effective income tax rate for the first quarter of 2024 was 2.2% compared to 23.9% in the same period of 2023. On an adjusted basis, the effective income tax rates were (12.4)% and 23.6% for the first quarter of 2024 and 2023, respectively, with the decrease primarily due to changes in the geographic income mix.

Energy Storage Results

In millions

Q1 2024

Q1 2023

$ Change

% Change

Net Sales

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