Albemarle Corporation · NYSE:ALB
Albemarle — Q1 2021 Earnings Presentation
29 slides from Albemarle's earnings presentation, May 6, 2021
Slide 1: First Quarter 2021 Earnings Conference Call/Webcast
Albemarle Corporation First Quarter 2021 Earnings Conference Call/Webcast Thursday, May 6, 2021 9:00am ET 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information presented in this presentation, the conference call and discussions that follow, including, without limitation, statements with respect to product development, market trends, price, expected growth and earnings, demand for our products, capital proj
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: Recent Accomplishments Support Long-term Growth
Recent Accomplishments Support Long-term Growth Q1 2021 net income of $96M or $0.84 per diluted share; adjusted EBITDA of $230M, up 17% Y/Y Total company FY 2021 guidance unchanged; Lithium performing better than expected Advancing growth plans; Lithium Wave 2 on track and progressing Wave 3 plans S
Slide 5: On Track to Deliver Wave 2 Commercial Volume in 2022
On Track to Deliver Wave 2 Commercial Volume in 2022 La Negra III / IV Kemerton I / II Site progress as of March 2021 Site progress as of April 2021 • Conversion of low-cost, high-quality Chilean brine • Conversion of low-cost, high-quality Australian spodumene • 40ktpa nameplate capacity – lithium
Slide 6: First Quarter 2021 Financial Summary
First Quarter 2021 Financial Summary (in millions, except per share amounts) Q1 2021 Q1 2020 Variance Net Sales $829 $739 12% Net income attributable to Albemarle Corporation $96 $107 -11% Adjusted EBITDA $230 $196 17% Adjusted EBITDA Margin 28% 27% Diluted EPS $0.84 $1.01 -17% Non-operating pension
Slide 7: Q1 2021 Adjusted EBITDA Bridge
Q1 2021 Adjusted EBITDA Bridge1 ($ in millions) 8 $250 30 4 230 23 15 $200 196 $150 Q1 2020 FX Impact Lithium Bromine Catalysts Corporate 1 & Q1 2021 Specialties Other ex FX 1 Corporate and Other includes Fine Chemistry Services (FCS). 7
Slide 8: Strong Balance Sheet to Support Accelerated Growth
Strong Balance Sheet to Support Accelerated Growth Net Debt to Adjusted EBITDA1 Selected Financial Metrics 3.4x ($ in millions) (as of 3/31/2021) 3.2x 3.2x 2.7x 2.5x Target Dividends Paid (TTM) $164 Long-term Dividend Growth (TTM Y/Y) 5% Leverage 1.7x 2.0x Range Cash Balance $570 Gross Debt2 $2,031
Slide 9: Maintaining 2021 Guidance
Maintaining 2021 Guidance FY 2021 2H 2021 Guidance FCS Guidance1 (Includes FCS)1 Net Sales $3.2B – $3.3B $70M – $90M Adjusted EBITDA $810M – $860M $25M – $35M Adjusted EBITDA Margin 25% – 26% - Adjusted Diluted EPS $3.25 – $3.65 $0.15 – $0.25 Net Cash from Operations $475M – $575M $30M – $40M Capita
Slide 10: Improving Trends in Lithium Offset Weakness in Catalysts
Improving Trends in Lithium Offset Weakness in Catalysts As of May 5, 2021 • Lithium outlook stronger than previously anticipated – FY 2021 adj. EBITDA up high single digits Y/Y • Higher volumes due to North American plant restarts, productivity improvements, and tolling • Average realized pricing e
Slide 11: Aligning Our Sustainability Framework with UN SDGs
Aligning Our Sustainability Framework with UN SDGs People, Workplace & Community We are committed to building an inclusive and diverse workplace. We promote collaboration and engage in the communities where we work and live. Natural Resource Management We responsibly manage our use of resources and
Slide 12: Well-Positioned to Drive Sustainable Growth
Well-Positioned to Drive Sustainable Growth 2021 OBJECTIVES Grow • Complete LAN III/IV (mid-2021) and Kemerton I/II (late-2021) Profitably • Investment decisions on new expansion projects in Lithium and Bromine • Achieve $75M productivity improvements versus 20201 Maximize • Preserve margins with be
Slide 13: Lithium Overview
Lithium Overview As of May 5, 2021 YoY Q1 Performance Drivers Q1 2021 PERFORMANCE • Net sales up 18% (price -10%, volume +28%); adjusted EBITDA up 35% ($M) Q1 2021 ΔQ1 2020 • Stronger volumes as customers accelerated orders, drew down inventory to meet demand Net Sales $279 18% $271 15% • Strong Q1
Slide 14: Catalysts Overview
Catalysts Overview As of May 5, 2021 YoY Q1 Performance Drivers Q1 2021 PERFORMANCE • Net sales up 6% (price 0%, volume +6%); adjusted EBITDA down 46% Q1 2021 ΔQ1 2020 • US Gulf Coast winter storm had $26 million cost impact on our two Houston-based sites ($M) • HPC volume up due to timing; FCC volu
Slide 15: Bromine Specialties Overview
Bromine Specialties Overview As of May 5, 2021 YoY Q1 Performance Drivers Q1 2021 PERFORMANCE • Net sales up 21% (price +6%, volume +15%); adjusted EBITDA up 14% ($M) Q1 2021 ΔQ1 2020 • Sales enabled by drawing down inventory • Winter storm impact dampened results in an otherwise strong quarter Net
Slide 16: Upcoming Investor Events
Upcoming Investor Events Second Quarter 2021 Investor Relations Events Date Event – All Virtual May 12th - 13th Goldman Sachs – Industrials & Materials Conference June 9th - 10th Non-deal Roadshow June 23rd BMO Chemicals & Packaging Conference Meredith Bandy David Burke Jeffrey Nakayama VP, Investor
Slide 17: Appendix
Appendix Non-GAAP Reconciliations
Slide 18: 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 19: 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. 19
Slide 20: EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA See above for a reconciliation of EBITDA, adjusted EBITDA and 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. 20
Slide 21: Adjusted EBITDA – by Segment (three months ended)
Adjusted EBITDA – by Segment (three months ended) See above for a reconciliation of adjusted EBITDA on a segment basis, the non-GAAP financial measure, to Net income attributable to Albemarle Corporation (“earnings”), the most directly comparable financial measure calculated and reporting in accorda
Slide 22: Adjusted EBITDA – Margin by Segment (three months ended)
Adjusted EBITDA – Margin by Segment (three months ended) See above for adjusted EBITDA margin, a non-GAAP financial measure defined as adjusted EBITDA divided by net sales. See previous slide for the related reconciliation of adjusted EBITDA on a segment basis, the non-GAAP financial measure, to Net
Slide 23: Adjusted EBITDA – (twelve months ended)
Adjusted EBITDA – (twelve months ended) See above for a reconciliation of adjusted EBITDA, 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. 23
Slide 24: Adjusted EBITDA – by Segment (twelve months ended)
Adjusted EBITDA – by Segment (twelve months ended) See above for a reconciliation of adjusted EBITDA on a segment basis, the non-GAAP financial measures, to Net income attributable to Albemarle Corporation (“earnings”), the most directly comparable financial measure calculated and reporting in accor
Slide 25: Adjusted EBITDA supplemental
Adjusted EBITDA supplemental1 1 This supplemental is for net-debt-to-adjusted EBITDA ratio based on the bank covenant definition. 25
Slide 26: Diluted EPS
Diluted EPS 1Totals may not add due to rounding 26
Slide 27: 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. 27
Slide 28: Equity Income and Noncontrolling Interest
Equity Income and Noncontrolling Interest 28
Slide 29: www.albemarle.com
\ ALBEMARLE’ NYSE www.albemarle.com 29