Albemarle Corporation · NYSE:ALB
Albemarle — Baird Global Industrial Conference 2020
26 slides from Albemarle's conference presentation, Nov 10, 2020
Slide 1: Albemarle Corporation Baird Global Industrial Conference Investor Presentation
Albemarle Corporation Baird Global Industrial Conference Investor Presentation and Non-GAAP Reconciliations November 10, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information presented in this presentation including, without limitation, statements with respect to product development, market trends, price, expected growth and earnings, demand for our products, capital projects, tax rates, stock repurchases, dividends, cas
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures It should be noted that Adjusted net income attributable to Albemarle Corporation (“Adjusted earnings”), Adjusted diluted earnings per share attributable to Albemarle Corporation, Adjusted effective income tax rates, segment operating profit, segment income, pro-forma net
Slide 4: Diversified Portfolio with Above-Market Margin
Diversified Portfolio with Above-Market Margin KEY STATS BUSINESS OVERVIEW 1887 Making the World Safe and Sustainable by Powering the Potential of People Founded 132 years Lithium Catalysts Bromine Specialties Global Employees1 ~5,600 Countries ~75 37% 27% 29% of Total of Total of Total Revenue Reve
Slide 5: Growth Strategy with Increased Focus on Operational Discipline
Growth Strategy with Increased Focus on Operational Discipline Invest in growth and be a leader in the lithium • Lithium demand has been pushed out by COVID approximately one Grow industry year; long term outlook unchanged Become best in class in the deployment of lithium • Deploy capital for lithiu
Slide 6: Catalysts Snapshot
Catalysts Snapshot Financials | TTM Q3 2020 including PCS Fluid Cracking Catalysts (FCC) FCC Catalysts $885M $185M 21% • Cracks oil feedstock into gasoline and chemicals • FCC market leadership in 1) Net Sales Adj. EBITDA1 Adj. EBITDA Margin1 bottoms cracking; 2) olefins output; and 3) emerging mark
Slide 7: Our Catalysts Are Used to Produce Clean Transportation Fuels and Chemicals
Our Catalysts Are Used to Produce Clean Transportation Fuels and Chemicals, and Are Integral to Refinery Profitability Gasoline / Petrochemicals Distillates HPC Kerosene 83M Diesel bpd *Reforming, isomerization not shown Crude Oil Feedstock Pretreatment Hydrocracking (HCPT) (HC) ~600 Atmospheric Die
Slide 8: End Markets Rebounding, Visibility Remains Challenging
End Markets Rebounding, Visibility Remains Challenging Lithium Bromine Catalysts 400 Regional Consumer Confidence2 Brent Price and Refinery Utilization2 Monthly EV Sales1 $80 100% 110% 350 (in thousands) September 300 100% China 75% 80% +90% yoy EU $60 250 90% S. Korea Japan $42 60% 200 US 80% $40 1
Slide 9: Catalysts Strategy: Build Upon Technology and Geographic Strengths
Catalysts Strategy: Build Upon Technology and Geographic Strengths in Order to Expand Leadership in Growth Markets Best-in-Class Presence Build on Operations & in Growth Our Strengths Sustainable Markets Approach Enhancing Customer Value Proposition Expanding Presence in Growth Areas, such as Talent
Slide 10: Emerging Oil-to-Chemicals Refineries Use FCC-type Technologies
Emerging Oil-to-Chemicals Refineries Use FCC-type Technologies for which Albemarle Leads in Innovation Petrochemicals Demand & New Crude Oil to Chemicals Technologies Will Drive FCC Industry Growth Beyond “Peak Gasoline” Traditional Refinery Traditional Oil Refinery Existing Product Slate Gas + Chem
Slide 11: Strategically Positioned Network of Assets Enable Growth
Strategically Positioned Network of Assets Enable Growth • 2T miles driven per year on clean transportation fuels Amsterdam, powered by our Netherlands Plant catalysts (equivalent to 80M times around Bayport, U.S.A. Plant the world) • Two thirds of the 600+ worldwide refineries use our catalysts • S
Slide 12: Putting Sustainability to Work in Catalysts
Putting Sustainability to Work in Catalysts Financials Safety Sustainable Our People & Business Ethics & Business Model Regulatory Compliance Workplace • ALB catalysts prevented ~10 Inclusive & Diverse Workplace • Hired a dedicated corporate million tons of sulfur from Customers & VP of Inclusion an
Slide 13: An Industry Leader with Significant Opportunity Ahead
An Industry Leader with Significant Opportunity Ahead 01 Industry-leading, competitively advantaged positions in Catalysts, Lithium, and Bromine which we believe will expand in the future Strong secular trends support long-term growth; Catalysts well positioned to benefit 02 from continued growth in
Slide 14: Appendix A: Non-GAAP Reconciliations and Supplemental Information
Appendix A Non-GAAP Reconciliations and Supplemental Information
Slide 15: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures NON-GAAP MEASURE DESCRIPTION Adjusted Net Income Net income attributable to Albemarle Corporation before non-recurring, other unusual and non-operating pension and OPEB. Pro-forma Adjusted Net Income Net income attributable to Albemarle Corporation before non-recurri
Slide 16: Adjusted Net Income
Adjusted Net Income See above for a reconciliation of adjusted net income, the non-GAAP financial measures, to Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reported in accordance with GAAP. 16
Slide 17: EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA Three Months Ended September 30, ($ in thousands) 2020 2019 Net income attributable to Albemarle Corporation $ 98,301 $ 155,070 Add back: Interest and financing expenses 19,227 11,108 Income tax expense 30,653 25,341 Depreciation and amortization 58,679 54,487 EBITDA 206,8
Slide 18: Adjusted EBITDA - by Segment (three months ended)
Adjusted EBITDA - by Segment (three months ended) Bromine Reportable Consolidated ($ in thousands) Lithium Specialties Catalysts Segments Total All Other Corporate Total Three months ended September 30, 2020 Net income (loss) attributable to Albemarle Corporation $ 69,102 $ 66,548 $ 25,176 $ 160,826
Slide 19: Adjusted EBITDA - Margin by Segment (three months ended)
Adjusted EBITDA - Margin by Segment (three months ended) Bromine Reportable ($ in thousands) Lithium Specialties Catalysts Segments Total All Other Consolidated Total Three months ended September 30, 2020 Net sales $ 265,646 $ 237,193 $ 197,919 $ 700,758 $ 46,110 $ 746,868 Net income (loss) attribut
Slide 20: Adjusted EBITDA - Continuing Operations (twelve months ended)
Adjusted EBITDA - Continuing Operations (twelve months ended) Twelve Months Ended ($ in thousands) Sep 30, 2019 Dec 31, 2019 Mar 31, 2020 Jun 30, 2020 Sep 30, 2020 Net income attributable to Albemarle Corporation $ 572,433 $ 533,228 $ 506,863 $ 438,289 $ 381,520 Depreciation and amortization 206,905
Slide 21: Adjusted EBITDA - by Segment (twelve months ended)
Adjusted EBITDA - by Segment (twelve months ended) Twelve Months Ended ($ in thousands) Sep 30, 2019 Dec 31, 2019 Mar 31, 2020 Jun 30, 2020 Sep 30, 2020 Lithium Net income attributable to Albemarle Corporation $ 424,881 $ 341,766 $ 301,837 $ 250,572 $ 217,538 Depreciation and amortization 95,102 99,
Slide 22: Adjusted EBITDA supplemental
Adjusted EBITDA supplemental1 Twelve Months ($ in thousands) Ended Three Months Ended Sep 30, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Adjusted EBITDA $ 892,276 $ 216,055 $ 185,193 $ 196,365 $ 294,663 Net income attributable to noncontrolling interests 69,161 18,744 18,134 16,431 15,
Slide 23: Diluted EPS
Diluted EPS 1Totals may not add due to rounding 23
Slide 24: Effective Tax Rate
Effective Tax Rate Income before income taxes and equity in net income of unconsolidated Effective income tax ($ in thousands) investments Income tax expense rate Three months ended September 30, 2020 As reported $ 121,544 $ 30,653 25.2 % Non-recurring, other unusual and non-operating pension and OP
Slide 25: Equity Income and Noncontrolling Interest
Equity Income and Noncontrolling Interest Note: Corporate equity income relates to foreign exchange gains or losses of our Windfield Holdings joint venture. 25
Slide 26: www.albemarle.com
\ ALBEMARLE’ NYSE www.albemarle.com 26