Slide 1: First Quarter 2019 Earnings Conference Call/Webcast
Albemarle Corporation First Quarter 2019 Earnings Conference Call/Webcast Thursday, May 9th, 2019 9:00am ET
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information presented in this presentation, the earnings conference call and discussions that follow, including, without limitation, information related to outlook and guidance, conversion capacity, production volumes, proposed joint ventures, market trends, pr
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: First Quarter Key Messages
First Quarter Key Messages Catalysts and Bromine Specialties grew Net Sales and Adjusted EBITDA year over year from increased volume and price, excluding divested businesses Lithium pricing up 3% YoY Construction of the first phase of the lithium hydroxide complex in Kemerton is underway and contrac
Slide 5: First Quarter 2019 Financial Summary
First Quarter 2019 Financial Summary (In millions, except per share amounts) Q1 2019 Q1 2018 Variance Net Sales $832 $822 1% Net income attributable to Albemarle Corporation $134 $132 1% Adjusted EBITDA $226 $249 -9% Diluted earnings per share $1.26 $1.18 7% Non-operating pension and OPEB items (0.0
Slide 6: First Quarter 2019 Pro-forma Financial Highlights
First Quarter 2019 Pro-forma Financial Highlights Q1 2019 Results Q1 2018 vs Prior Year Pro-forma 1 Pro-forma1 Net Sales $832 million $795 million +5% Net Sales ex FX2 $845 million +6% Adjusted $226 million $238 million -5% EBITDA $232 million -3% Adj. EBITDA ex FX2 Adjusted $1.23 $1.22 +1% Diluted
Slide 7: Segment Quarterly Highlights
Segment Quarterly Highlights TTM1 Pro-forma Net Sales2 ($ in millions) TTM1 Pro-forma Adj. EBITDA2 and ($ in millions) Adj. EBITDA Margin2 $3,500 $1,100 31% $1,000 $3,250 $900 29% $800 27% $3,000 $700 $600 25% $2,750 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 Pro-forma Adjusted EBITDA 2 Pro-f
Slide 8: First Quarter 2019 Adjusted EBITDA Bridge
First Quarter 2019 Adjusted EBITDA Bridge Q1 2019: Adjusted EBITDA down $12 million, -5% YOY1 ($ in millions) 249 $250 238 11 6 226 11 6 6 17 $200 $150 Q1 2018 PO Catalysts Pro Forma FX Impact Lithium Bromine Catalysts Corporate & Q1 2019 1 as reported & Q1 2018 Specialties Other 1 Components Net of
Slide 9: Lithium
Lithium Q1 2019 Performance Historical Trend (TTM) ($ in millions) Q1 2019 Q1 2018 ∆ $600 50% Net Sales $292 $298 -2% $500 40% $400 Adj. EBITDA $116 $131 -12% 30% $300 Adj. EBITDA Margin 40% 44% (435) bps $200 20% 1Q18 2Q18 3Q18 4Q18 1Q19 Adjusted EBITDA Adjusted EBITDA Margin Performance Drivers •
Slide 10: Bromine Specialties
Bromine Specialties Q1 2019 Performance Historical Trend (TTM) ($ in millions) Q1 2019 Q1 2018 ∆ $300 35% Net Sales $249 $226 10% $250 Adj. EBITDA $79 $70 12% 25% $200 Adj. EBITDA Margin 32% 31% 55 bps $150 15% 1Q18 2Q18 3Q18 4Q18 1Q19 Adjusted EBITDA Adjusted EBITDA Margin Performance Drivers • Q1
Slide 11: Catalysts
Catalysts Q1 2019 Performance Historical Trend (TTM) ∆ vs $300 30% ($ in millions) Pro-forma1 Pro-forma1 Q1 2019 Q1 2018 Q1 2018 Q1 2018 $250 Net Sales $252 $261 $234 8% 25% $200 Adj. EBITDA $60 $68 $57 5% 20% $150 Adj. EBITDA Margin 24% 26% 24% (51) bps $100 15% 1Q18 2Q18 3Q18 4Q18 1Q19 2 2 Pro-for
Slide 12: Cash Flow and Net Debt
Cash Flow and Net Debt Three Months Ended March 31 Selected Financial Metrics ($ in millions) ($ in millions) (as of 03/31/2019) 2019 2018 Dividends Paid (YTD): $35 Net Cash from Operations $55 $122 Dividend Growth (Y/Y)1: 10% Less: Capital Expenditures (216) (132) Cash Balance: $465 Add Back: Pensi
Slide 13: Full Year 2019 Business Guidance vs 2018
Full Year 2019 Business Guidance vs 2018 As of May 8, 2019 Business Prior Updated Business Environment Unit Outlook Outlook • Adj. EBITDA growth expected to be in the high teens vs prior year • Favorable outlook driven by volume growth and flat to inflationary price increases Lithium • Increased cos
Slide 14: Full Year 2019 Guidance vs 2018
Full Year 2019 Guidance vs 2018 As of May 8, 2019 2019 Guidance FY 2018 FY 2019 FY 2018 vs Pro-forma1 Guidance FY 2018 Pro-Forma1 Net Sales $3.37B $3.35B $3.65B – $3.85B 9% – 15% Adjusted EBITDA $1,007M $996M $1,070M – $1,140M 7% – 14% Adjusted EBITDA Margin 30% 30% 29% – 31% Adjusted Diluted EPS $5
Slide 15: www.albemarle.com
.\ ALBEMARLE’ NYSE www.albemarle.com 15
Slide 16: Appendix: Non-GAAP Reconciliations and Supplemental Information
Appendix Non-GAAP Reconciliations and Supplemental Information
Slide 17: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures Non-GAAP Measure Description Adjusted net income Net income attributable to Albemarle Corporation before non-recurring, other unusual and non-operating pension and OPEB. Pro-forma adjusted net income Net income attributable to Albemarle Corporation before non-recurri
Slide 18: Adjusted Net Income - Pro-forma
Adjusted Net Income - Pro-forma Three Months Ended March 31, ($ in thousands) 2019 2018 Net income attributable to Albemarle Corporation $ 133,569 $ 131,760 Add back: Non-operating pension and OPEB items (net of tax) (569) (1,866) Non-recurring and other unusual items (net of tax) (2,012) 15,319 Adj
Slide 19: EBITDA and Adjusted EBITDA - Pro-forma
EBITDA and Adjusted EBITDA - Pro-forma Three Months Ended March 31, ($ in thousands) 2019 2018 Net income attributable to Albemarle Corporation $ 133,569 $ 131,760 Add back: Interest and financing expenses 12,586 13,538 Income tax expense 37,514 20,361 Depreciation and amortization 49,283 50,330 EBI
Slide 20: Adjusted EBITDA - by Segment (three months ended March 31)
Adjusted EBITDA - by Segment (three months ended March 31) Reportable ($ in thousands) Lithium Bromine Specialties Catalysts Segments Total All Other Corporate Consolidated Total Three months ended March 31, 2019: Net income (loss) attributable to Albemarle Corporation $ 93,169 $ 67,480 $ 47,859 $ 2
Slide 21: Adjusted EBITDA - Margin by Segment (three months ended March 31)
Adjusted EBITDA - Margin by Segment (three months ended March 31) Bromine Reportable ($ in thousands) Lithium Specialties Catalysts Segments Total All Other Consolidated Total Three months ended March 31, 2019: Net sales $ 291,886 $ 249,052 $ 251,648 $ 792,586 $ 39,478 $ 832,064 Net income (loss) at
Slide 22: Adjusted EBITDA - Continuing Operations (twelve months ended)
Adjusted EBITDA - Continuing Operations (twelve months ended) Twelve Months Ended ($ in thousands) Mar 31, 2018 Jun 30, 2018 Sep 30, 2018 Dec 31, 2018 Mar 31, 2019 Continuing Operations Net income attributable to Albemarle Corporation $ 135,397 $ 334,525 $ 345,600 $ 693,562 $ 695,371 Depreciation an
Slide 23: Adjusted EBITDA - by Segment (twelve months ended)
Adjusted EBITDA - by Segment (twelve months ended) Twelve Months Ended ($ in thousands) Mar 31, 2018 Jun 30, 2018 Sep 30, 2018 Dec 31, 2018 Mar 31, 2019 Lithium Net income attributable to Albemarle Corporation $ 373,712 $ 409,185 $ 409,753 $ 428,212 $ 413,047 Depreciation and amortization 92,879 95,
Slide 24: Adjusted EBITDA supplemental
Adjusted EBITDA supplemental1 Twelve Months ($ in thousands) Ended Three Months Ended Mar 31, 2019 Mar 31, 2019 Dec 31, 2018 Sep 30, 2018 Jun 30, 2018 Adjusted EBITDA $ 983,813 $ 225,867 $ 264,302 $ 235,082 $ 258,562 Net income attributable to noncontrolling interests 56,369 17,957 16,453 13,734 8,2
Slide 25: Diluted EPS
Diluted EPS Three Months Ended March 31, 2019 2018 Diluted earnings per share attributable to Albemarle Corporation $ 1.26 $ 1.18 Add back: Non-operating pension and OPEB items (net of tax) (0.01) (0.02) Non-recurring and other unusual items (net of tax) Acquisition and integration related costs 0.0
Slide 26: Effective Tax Rate
Effective Tax Rate Income before income taxes and equity in net income of ($ in thousands) unconsolidated investments Income tax expense Effective income tax rate Three months ended March 31, 2019: As reported $ 153,859 $ 37,514 24.4% Non-recurring, other unusual and non-operating pension and OPEB i
Slide 27: Equity Income and Noncontrolling Interest
Equity Income and Noncontrolling Interest Three Months Ended March 31, 2019 2018 Noncontrolling Noncontrolling ($ in thousands) Equity Income Interest Equity Income Interest Lithium $ 29,370 $ — $ 16,190 $ — Bromine Specialties — (17,939) — (7,149) Catalysts 5,811 — 4,487 — Corporate — (18) — (16) T
Slide 28: www.albemarle.com
‘\ALBEMARLE” NYSE www.albemarle.com