Slide 1: Albemarle Q2 2023 Earnings
Albemarle Q2 2023 Earnings Aug 3, 2023 9:00am ET
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation, conference call and discussions that follow contain 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 o
Slide 3: Non-GAAP Measures
Non-GAAP Measures It should be noted that adjusted net (loss) income attributable to Albemarle Corporation, adjusted diluted earnings per share (“EPS”), non-operating pension and other post-employment benefit (“OPEB”) items per diluted share, non-recurring and other unusual items per diluted share,
Slide 4: Excellent Q2 Results Supporting Growth
Excellent Q2 Results Supporting Growth $2.4B Q2 2023 NET SALES +60% VS PRIOR YEAR ▪ Recognized for Albemarle’s growth, impact, and sustainability efforts − Named to Fortune 500 and TIME100 − Achieved IRMA 50 in the Salar de Atacama − Published 2022 Sustainability Report, with strong $1.0B Q2 2023 AD
Slide 5: Q2 2023 Financial Summary
Q2 2023 Financial Summary (in millions, except per share amounts) Q2 2023 Q2 2022 Variance Net Sales $2,370 $1,480 +60% Net Income Attributable to Albemarle Corporation $650 $407 +60% Adjusted EBITDA1 $1,032 $610 +69% Adjusted EBITDA Margin1 44% 41% +300 bps Diluted EPS $5.52 $3.46 +60% Non-Operatin
Slide 6: Q2 2023 Adjusted EBITDA Bridge
Q2 2023 Adjusted EBITDA1 Bridge ($ in millions) +69% Net of FX Note: Numbers may not reconcile due to rounding. 1 See appendix for non-GAAP reconciliations. 6
Slide 7: Raising FY 2023 Outlook to Reflect Recent Lithium Market Prices
Raising FY 2023 Outlook to Reflect Recent Lithium Market Prices • Increase in Adj. EBITDA primarily due to higher Energy Storage Revised pricing Previous FY 2023 2023 Revised • Decrease in Net Cash from FY 2023 Guidance Guidance2 Guidance Operations primarily driven by FY 2022 as of May 3, 2023 as o
Slide 8: Improved Energy Storage Outlook More Than Offsets Economic Pressures on Specialties
Improved Energy Storage Outlook More Than Offsets Economic Pressures on Specialties As of August 2, 2023 • Energy Storage FY 2023 adj. EBITDA expected to be up 15-30% Y/Y, as higher net sales more than offset timing impacts of higher priced spodumene inventories; increase from previous outlook refle
Slide 9: Contract Pricing Reflects Changes in Lithium Market Prices
Contract Pricing Reflects Changes in Lithium Market Prices Energy Storage Net Sales1 Leverage to Continued Strong Market Prices (by Contract Type) ▪ Majority of volumes sold under long-term contracts (typically 2-5 years duration) with strategic customers Spot ▪ Partnerships across the value chain i
Slide 10: Maintaining Strategy to Deliver Volumetric Growth
Maintaining Strategy to Deliver Volumetric Growth Expected Lithium Sales Volumes (kt LCE) ▪ Assumes ~2 years to ramp a new 350 conversion plant Potential Tolling 300 Technical Grade Spodumene ▪ Includes expansions at Silver Peak, Lithium Carbonate +/- Lithium Hydroxide La Negra, Kemerton, Qinzhou, a
Slide 11: Energy Storage Adjusted EBITDA Margin Bridge – 2022 vs 2023 forecast
Energy Storage Adjusted EBITDA Margin Bridge – 2022 vs 2023 forecast Talison JV Tax Impact 7% ~10% ~20% Pre-Tax Adj. EBITDA Margin ~5% ~5% ~6% EBITDA Margin 72% Pre-Tax Adj. 65% ~46% ~45% 2 2022 Adj. EBITDA Price Talison JV MARBL JV Acct'g Other 2023 Adj. EBITDA Margin1 Spod Inventory Margin Lag 202
Slide 12: Disciplined Capital Allocation to Support Growth Strategy
Disciplined Capital Allocation to Support Growth Strategy Invest in Portfolio Maintain Financial Dividends & Share High-Return Growth Management Flexibility Repurchases ▪ Growth remains the primary ▪ Actively assess portfolio; ▪ Committed to Investment ▪ Continue to support our capital allocation pr
Slide 13: Our Operating Model: How We Execute & Accelerate Our Strategy
Our Operating Model: FEATURED PILLAR How We Execute & Accelerate Our Strategy Operational Discipline • Embrace LEAN principles and continuous improvement • Drive manufacturing, business and capital execution excellence On track to exceed $250M in productivity benefits: • Manufacturing - target of $1
Slide 14: Strengthening Global Footprint in Resources and Conversion
Strengthening Global Footprint in Resources and Conversion Q2 2023 Project Developments Amended Agreements with Mineral Resources Chile • Acquire 100% ownership of Kemerton • Salar Yield Improvement Project achieved mechanical • Wodgina jointly owned 50/50 under MARBL JV completion and has moved to
Slide 15: Global EV Demand Outlook Regains Strong Growth Momentum
Global EV Demand Outlook Regains Strong Growth Momentum ‘20-’23 Global EV Sales: Cumulative YTD1 Global EV Sales: Monthly Actuals1 20 1.5 Monthly EV Sales (millions) Cumulative EV Sales (millions) 2023 LEV 15 Production2 14.9M 1.0 10 10.5M 0.5 6.4M 5 2.9M 0 0.0 Jan Mar May Jul Sep Nov Jan Mar May Ju
Slide 16: Key Takeaways
Continuing to expect growth in 2023, increasing guidance with net sales +40-55% YoY A global leader with world-class assets and a diversified product portfolio; long-term supply with reliable, consistent quality Key Capitalizing on tremendous growth opportunities in electric vehicles and Takeaways b
Slide 17: Q2 2023 Investor Relations Events
Q2 2023 Investor Relations Events Aug 3-4 Q2 2023 Earnings Meredith Bandy, CFA VP, Investor Relations & Sustainability meredith.bandy@albemarle.com +1 980.999.5168 Sept 6 UBS Chemicals Conference Brook Wootton, IRC Sept 7 Jefferies Industrials Conference Senior Director, Investor Relations brook.woo
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Slide 19: Appendix: Non-GAAP Reconciliations
Appendix: Non-GAAP Reconciliations
Slide 20: 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 21: Adjusted Net Income
Adjusted Net Income Three onths Ended Year Ended une 30, December 3 , 2023 2022 2022 Net income attributable to Albemarle Corporation $ 5 , $ ,77 $ 2, 89,81 Add back Non operating pension and OPEB items (net of tax) 81 ( ,9 ) ( 2,189) Non recurring and other unusual items (net of tax) 21 ,19 2,9 9 (
Slide 22: EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA Three onths Ended Year Ended une 30, December 3 , 2023 2022 2022 of net of net of net sales sales sales Net income attributable to Albemarle Corporation $ 5 , 27. $ ,77 27.5 $ 2, 89,81 .7 Add back nterest and financing expenses 25,577 1.1 1, 9 2.8 122,97 1.7 ncome tax expe
Slide 23: Adjusted EBITDA – Continuing Operations (twelve months ended)
Adjusted EBITDA – Continuing Operations (twelve months ended) Twelve onths Ended un 30, 2022 Sep 30, 2022 Dec 3 , 2022 ar 3 , 2023 un 30, 2023 Net income attributable to Albemarle Corporation $ 2 ,551 $ 1,55 ,5 7 $ 2, 89,81 $ , 75, 1 $ ,918,28 Depreciation and amorti ation 2 7,88 28 ,515 ,8 1 21,5 8
Slide 24: Adjusted EBITDA supplemental
Adjusted EBITDA supplemental1 Twelve onths Ended Three onths Ended un 30, 2023 un 30, 2023 ar 3 , 2023 Dec 3 , 2022 Sep 30, 2022 Ad usted E TDA ,0 , 03 ,032,2 , , ,2 3, 2 , , Net income attributable to noncontrolling interests 127,851 2 , 9 8,12 29, 1 ,991 Equity in net income of unconsolidated inve
Slide 25: Diluted EPS
Diluted EPS Three onths Ended une 30, 2023 2022 Diluted earnings per share attributable to Albemarle Corporation $ 5.52 $ . Add back Non operating pension and OPEB items (net of tax) ( . ) Non recurring and other unusual items (net of tax) Acquisition and integration related costs . . Mark to market
Slide 26: Effective Tax Rate
Effective Tax Rate See above 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 reporting in accordance with GAAP. 26
Slide 27: Equity Income and Noncontrolling Interest
Equity Income and Noncontrolling Interest Three onths Ended une 30, 2023 2022 oncontrolling oncontrolling E uit ncome nterest E uit ncome nterest Energy Storage $ 5 ,798 $ $ 11 , $ Specialties (2 , 5 ) ( ,792) etjen 5,1 8 9,52 Corporate 2,1 5 ( 2) 2,297 (27) Total Company $ 551, 51 $ (2 , 9 ) $ 128,
Slide 28: www.albemarle.com
NYSE www.albemarle.com