Slide 1: Q1 2024 Earnings
Q1 2024 Earnings May 2, 2024 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 income attributable to Albemarle Corporation common shareholders, adjusted diluted earnings per share attributable to common shareholders (“EPS”), non-operating pension and other post-employment benefit (“OPEB”) items per diluted share, non-recu
Slide 4: Q1 2024 net sales of $1.4B and adj. EBITDA of $291M
Q1 2024 net sales of $1.4B and adj. EBITDA1 of $291M, driven by Energy Storage volume growth Q1 2024 results and Reaffirmed FY 2024 corporate outlook considerations based on lithium actions strengthened our market price scenarios competitive position, On track to deliver >$280 million target in prod
Slide 5: Q1 2024 Financial Summary
Q1 2024 Financial Summary (in millions, except per share amounts) Q1 2024 Q1 2023 Variance Net Sales $1,361 $2,580 -47% Net Income Attributable to Albemarle Corporation $2 $1,239 -100% Adjusted EBITDA1 $291 $1,762 -83% Adjusted EBITDA Margin1 21% 68% -4700 bps Diluted EPS Attributable to Common Shar
Slide 6: Q1 2024 Adjusted EBITDA Bridge
Q1 2024 Adjusted EBITDA1 Bridge ($ in millions) Focused on controlling what we can control – improving volumes and productivity in a dynamic market Note: Numbers may not reconcile due to rounding. 1 See appendix for non-GAAP reconciliations. 2 Includes S&A, productivity benefits, inflation, and FX 6
Slide 7: Total Company Outlook Considerations
Total Company Outlook Considerations1 Avg Lithium Market Price (US$/kg LCE)2 ▪ Reaffirming outlook considerations FY 2023 avg. YE 2023 Q4 2023 avg. H2 2023 avg. ▪ Ranges based on observed lithium market pricing $40 $15 $20 $25 ▪ To account for the convertible preferred Albemarle Albemarle shares, Al
Slide 8: 2024 Operating Cash Flow Considerations
2024 Operating Cash Flow Considerations Operating Cash Flow ▪ In recent years, Albemarle has averaged an operating cash flow conversion1 of 40-50%2 Conversion ▪ Cash conversion in 2024 is expected to be below historical average due to discrete cash flow headwinds totaling 50% $400 - $600 million, pr
Slide 9: 2024 Commentary by Segment
2024 Commentary by Segment1 ▪ ~2/3 of 2024E volumes sold on index referenced, variable priced contracts; average 2-5 years duration; typically 3-month lag, some STORAGE with floors and ceilings, specifics vary by contract ▪ ~1/3 of 2024E volumes sold on short-term purchase agreements ▪ Volume growth
Slide 10: Committed to Maintaining Investment Grade Credit Rating
Committed to Maintaining Investment Grade Credit Rating1 Capital Structure Total Liquidity: $3.7B $120 Other Credit Lines ▪ $2.1B cash and cash equivalents $3,530 Total Debt $1,500 Revolver ▪ $3.5B total debt ▪ Weighted average interest rate of 3.6% (100% fixed) ▪ Q1 2024 net debt to adjusted EBITDA
Slide 11: Capital Allocation Priorities Remain Unchanged
Capital Allocation Priorities Remain Unchanged 1 High-Return Growth 2 Financial Flexibility 3 Shareholder Remuneration 4 Portfolio Management ▪ Strategically grow ▪ Committed to ▪ Continue to support our ▪ Pursue suite of organic Energy Storage and Investment Grade credit dividend; grow dividend inv
Slide 12: Global EV Demand Growth +20% YTD, Led by China
Global EV Demand Growth +20% YTD, Led by China Global EV Sales1 China EV Sales1 Europe EV Sales1 North America EV Sales1 (in millions) 15 15 15 15 60% 20% 10% 10 of Global of Global of Global 10 10 10 +21%1 5 YTD 5 +32% 5 5 YTD +19%1 +10% YTD YTD 0 0 0 0 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep N
Slide 13: Bidding Events Promote Price Discovery and Transparency
Bidding Events Promote Price Recent bidding events process Discovery and Transparency ▪ Set quantities for 30-day fulfillment ▪ Transparent rules and governance ▪ Albemarle has successfully conducted four ▪ No cost to participate successful bidding events to-date for chemical-grade spodumene and bat
Slide 14: Operational Discipline - Central to Our Operating Model
Operational Discipline - Central to Our Operating Model Productivity - as of Q1, benefits on-track to exceed 2024 target of $280 million; initiatives include: ▪ Manufacturing ($80M target) - Yield, rate, and availability improvements at La Negra, Qinzhou, and Xinyu ▪ Procurement ($150M target) - Cap
Slide 15: Project Developments Strengthen Our Global Footprint
Project Developments Strengthen Our Global Footprint Chile • Salar Yield Improvement Project achieved 50% operating rate milestone and is ramping to nameplate capacity Australia • Kemerton I has achieved 50% operating rate milestone for battery-grade product • Kemerton II is progressing through comm
Slide 16: Maintaining Strategy to Deliver Volumetric Growth
Maintaining Strategy to Deliver Volumetric Growth Expected Lithium Sales Volumes1 ▪ Q1 sales volumes of 41 kT LCE 350 (kt LCE) ▪ 2024 volume weighted towards MinRes Share 2H due to demand seasonality Potential Tolling/Spodumene 300 and project ramp Lithium Carbonate Lithium Hydroxide +/- ▪ Assumes ~
Slide 17: Attractive Growth, Margin & Low-Cost Drivers Across the Cycle
Attractive Growth, Margin & Low-Cost Drivers Across the Cycle Resource, grade, and scale drive our low-cost position Energy Storage margin improvement, independent of Lithium Spodumene Operations1 Lithium Brine Operations1 price upside ALB ALB Li Concentration (mg/L Li) +50% +60% ~225 bps Li Grade (
Slide 18: Resilient Competitive Strengths to Navigate Market Conditions
Resilient Competitive Strengths to Navigate Market Conditions ▪ Diversified portfolio of best-in-class assets and resources around the globe World-Class Resources ▪ Low-cost position with vertical integration into large, high-grade resources ▪ Deep technical and operational know-how to transform ess
Slide 19: Strong value proposition
A global leader with vertical integration strength, world-class assets and a diversified product portfolio Capitalizing on long-term secular growth opportunities supporting the clean energy transition and enhanced mobility, connectivity, and health Strong value proposition Taking action to preserve
Slide 20: Q2 2024 Investor Relations Events
Q2 2024 Investor Relations Events May 21-22 US East Coast NDR Meredith Bandy, CFA VP, Investor Relations & Sustainability meredith.bandy@albemarle.com +1 980.999.5168 May 23 Toronto NDR Eran del Castillo Senior Manager, Investor Relations Jun 3-6 Europe NDR eran.delcastillo@albemarle.com +1 980.299.
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Slide 22: Energy Storage Market Price Scenarios
Energy Storage Market Price Scenarios1 FY 2024E Assumptions: Avg Lithium Market Price (US$/kg LCE)2 Energy Storage ranges based FY 2023 avg. YE 2023 Q4 2023 avg. H2 2023 avg. on projected volume increase of $40 $15 $20 $25 10 to 20% Y/Y in 2024 Energy Storage Energy Storage FY 2023A FY 2024E Current
Slide 23: Specialties, Ketjen, and Corporate Outlook Considerations
Specialties, Ketjen, and Corporate Outlook Considerations FY 2023A FY 2024E Segments as of May 1, 2024 Specialties Net Sales $1.5B $1.3B – $1.5B Specialties Adj. EBITDA $300M $270M – $330M Ketjen Net Sales $1.1B $1.0B – $1.2B Ketjen Adj. EBITDA $104M $130M – $150M Other Corporate Capital Expenditure
Slide 24: Re-phasing Growth Investments to Optimize Cash Flow
Re-phasing Growth Investments to Optimize Cash Flow 2024 planned capital expenditures include: Capital Expenditures1 ▪ Continuing critical health, safety, environmental $2.5 ($ billions) and site maintenance projects $2.1B Conversion Technology ▪ Commissioning the Meishan, China lithium $2.0 Resourc
Slide 25: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures NON-GAAP MEASURE DESCRIPTION Adjusted Net Income Attributable to Net income after mandatory convertible preferred stock dividends before non-recurring, other unusual and non-operating pension and OPEB. Common Shareholders Adjusted Diluted EPS Attributable to Diluted
Slide 26: 2024 Adj. EBITDA Definition
2024 Adj. EBITDA Definition Net income attributable to Albemarle Corporation 1,5 ,4 1,5 ,4 Depreciation and amorti ation 429,944 429,944 Interest and financing expenses 11 ,0 2 11 ,0 2 Income tax expense 4 0,2 4 0,2 Proportionate share of indfield oldings income tax expense 9, 0 Gain on sale of busi
Slide 27: Adjusted Net Income
Adjusted Net Income Net income attributable to Albemarle Corporation 2,44 1,2 ,5 0 1,5 ,4 Add back: Non operating pension and OPEB items (net of tax) ( 51) 4 ( ,9 ) Non recurring and other unusual items (net of tax) 40,044 (22, 4) 22 , 5 Adjusted net income attributable to Albemarle Corporation 42,1
Slide 28: EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA Net income attributable to Albemarle Corporation 2,44 0.2 1,2 ,5 0 4 .0 1,5 ,4 1 .4 Add back: Interest and financing expenses ,9 9 2. 2 , 1.0 11 ,0 2 1.2 Income tax expense ( , 21) (0. ) 2 ,9 10. 4 0,2 4.5 Depreciation and amorti ation 12 , 51 9.1 ,2 1 .4 429,944 4.5 1 0,4
Slide 29: Adjusted EBITDA – Continuing Operations (twelve months ended)
Adjusted EBITDA – Continuing Operations (twelve months ended) Net income attributable to Albemarle Corporation , 5,01 ,91 ,2 , 2 , 01 1,5 ,4 , 44 Depreciation and amorti ation 21,5 4 , 0 1, 2 429,944 4 ,424 Proportionate share of indfield oldings income tax expense 4 2,922 4 ,109 , 5 9, 02 ,40 Non r
Slide 30: Adjusted EBITDA supplemental
Adjusted EBITDA supplemental1 E uity in net income of non indfield oldings unconsolidated investments (net of tax) (19,425) ( , 21) (2,121) (4, 5) (5,10 ) Dividends received from non indfield oldings unconsolidated investments 1 ,91 1, 5 5,2 ,1 2, 49 indfield oldings debt 4 2,209 Off balance sheet o
Slide 31: Diluted EPS
Diluted EPS Diluted earnings per share attributable to Albemarle Corporation common shareholders (0.0 ) 10.51 Add back: Non operating pension and OPEB items (net of tax) Non recurring and other unusual items (net of tax) Restructuring and other 0.2 Ac uisition and integration related costs 0.01 0.0
Slide 32: Effective Tax Rate
Effective Tax Rate As reported (1 ,5 4) ( , 21) 2.2 Non recurring, other unusual and non operating pension and OPEB items 5 ,100 1 ,40 As adjusted (110,4 4) 1 , (12.4) As reported 1,15 ,4 2 ,9 2 .9 Non recurring, other unusual and non operating pension and OPEB items ( , 2) (11,4 2) As adjusted 1,12
Slide 33: Equity Income and Noncontrolling Interest
Equity Income and Noncontrolling Interest Energy Storage 1 1,5 4 , 59 Specialties (1 ,11 ) ( ,2 2) etjen , 21 , 9 Corporate 1,145 (1,0 2) 10,440 109 Total Company 1 0,500 (14,199) 9 ,1 ( ,12 ) Note: Corporate equity income relates to foreign exchange gains or losses of our Windfield Holdings joint v
Slide 34: www.albemarle.com
NYSE www.albemarle.com \ Albemarle®