b9b7e837f388a7577fa75f00fcd21d3440d24bc412d9c96ae58ae031e19fcac8

The net sales in Q1 2024 were significantly lower primarily because **lower lithium carbonate and hydroxide market pricing** had a substantial negative impact, with a decrease of **$1.8 billion in sales** driving most of the decline. This pricing downturn more than offset the benefit from **higher sales volumes** in certain segments, and the overall effect was compounded by an **unfavorable currency translation** due to a stronger U.S. Dollar.  **[0000915913-24-000100_alb-20240331.htm:36]** **[0000915913-24-000100_alb-20240331.htm:41]** **[0000915913-24-000098_a1q24earningsreleaseex991.htm:2]** 

Why were net sales so low in Q1 2024?

The drastic drop in gross profit in Q1 2024 was primarily driven by **lower pricing** impacts in the Energy Storage segment, particularly for lithium carbonate and hydroxide sold under index-referenced and variable-priced contracts. Additionally, **unfavorable currency exchange impacts** due to a stronger U.S. Dollar against other currencies significantly contributed to the decline, even though higher sales volumes in the Energy Storage segment provided only a partial offset to these negative effects.  **[0000915913-24-000100_alb-20240331.htm:36]** **[0000915913-24-000100_alb-20240331.htm:41]** 

What caused the drastic drop in gross profit in Q1 2024?

The dramatic operating loss in **Q3 2024** was primarily driven by **substantial restructuring charges and asset write-offs** (with expenses of **$828,146 thousand** compared to **$1,757 thousand** in Q3 2023), along with a shift from a **gross profit** in Q3 2023 to a **gross loss** in Q3 2024. This was compounded by a marked **41% decline in net sales**, largely due to a **71% fall in pricing** in the Energy Storage segment, increased **research and development expenses** (a **6% rise**), and a significant **63% jump in interest and financing expenses**.  **[0000915913-24-000158_alb-20240930.htm:42]** **[0000915913-24-000158_alb-20240930.htm:43]** **[0000915913-24-000156_a3q24earningsreleaseex991.htm:3]** **[20241106PH48992:2]** 

What drove the dramatic operating loss in Q3 2024?

The drastic negative swing in net income during **Q3 2024** was driven by a combination of factors. **Lower net sales** played a major role, falling by **41%** due to a **71% drop in pricing** in the Energy Storage segment (despite a modest uptick in volumes), which significantly reduced revenue. Additionally, the company incurred massive **restructuring charges and asset write-offs**—jumping from a very small charge in the prior quarter to **$828,146 thousand**—and moved from a strong **gross profit of $54,934 thousand** in Q3 2023 to a **gross loss of $(104,034) thousand** in Q3 2024. Furthermore, **reduced equity earnings**, a **63% increase in interest and financing expenses**, and a shift from a **tax benefit** to an **income tax expense** also contributed to the overall negative swing. These combined impacts resulted in a net income decline of approximately **$1,371,525 thousand** from Q3 2023 to Q3 2024.  **[0000915913-24-000156_a3q24earningsreleaseex991.htm:3]** **[0000915913-24-000158_alb-20240930.htm:42]** **[0000915913-24-000158_alb-20240930.htm:43]** 

Why did net income swing drastically negative in Q3 2024?

EPS turned significantly negative in Q3 2024 primarily because the company shifted from a net income of **$302.5 million** in Q3 2023 to a net loss of **$(1.1) billion** in Q3 2024. This drastic swing was driven by several factors, including **pre-tax charges of $861 million** related to restructuring and asset write-offs, a significant decline in pricing—especially in the Energy Storage segment, where net sales dropped by **55%**—and additional pressure from a **$41.7 million** reduction for mandatory convertible preferred stock dividends. Together, these elements led to lower revenues, margin compression (with an adjusted EBITDA decline of **67.6%**), and ultimately a substantial negative impact on earnings per share.  **[0000915913-24-000156_a3q24earningsreleaseex991.htm:3]** **[0000915913-24-000158_alb-20240930.htm:43]** **[20241106PH48992:0]** **[20241106PH48992:2]** 

Why did EPS turn significantly negative in Q3 2024?

71c5eb9952d32bf590f6657c9464f4cd141e0bbc59e43cd2b958181389b6c78b

The surge in **cash and cash equivalents** in Q1 2024 was primarily driven by the **issuance of mandatory convertible preferred stock**, which generated **approximately $2.2 billion** in net proceeds. This influx of funds was then partly used to repay **$620.8 million** in commercial paper, with other factors such as capital expenditures and operating cash flows also playing a role, though the issuance of preferred stock was the key driver.  **[0000915913-24-000100_alb-20240331.htm:43]** 

Why did Cash and cash equivalents surge in Q1 2024?

The drop in total assets by Q4 2024 was primarily driven by several factors. **Inventories** declined by **$658,756 thousand** (from **$2,161,287 thousand** to **$1,502,531 thousand**), **trade accounts receivable** fell by **$470,959 thousand** (from **$1,213,160 thousand** to **$742,201 thousand**), **other current assets** decreased by **$276,559 thousand** (from **$443,475 thousand** to **$166,916 thousand**), **investments** were reduced by **$252,116 thousand** (from **$1,369,855 thousand** to **$1,117,739 thousand**), and there was a slight decrease in **goodwill** by **$47,015 thousand** (from **$1,629,729 thousand** to **$1,582,714 thousand**). Although this decline was partially offset by an increase in **cash and cash equivalents** by **$302,330 thousand**, the overall effect led to a significant drop in total assets.  **[0000915913-25-000026_alb-20241231.htm:168]** **[0000915913-25-000023_a4q24earningsreleaseex991.htm:6]** 

What factors contributed to the drop in Total assets by Q4 2024?

The sharp decline in Albemarle's long-term debt in Q4 2024 was primarily driven by a **net repayment of $620,000 thousand** in commercial paper notes, which was funded by proceeds from the issuance of **Mandatory Convertible Preferred Stock**. Additionally, the company recorded **amortization of debt discounts**—including those from an interest-free loan arranged in 2023—and made scheduled payments on maturing debt obligations (with **$398,023 thousand** due within one year), all of which collectively contributed to the reduction in long-term debt.  **[0000915913-25-000026_alb-20241231.htm:197]** **[0000915913-25-000026_alb-20241231.htm:146]** **[0000915913-25-000026_alb-20241231.htm:112]** 

What led to the sharp decline in Long-term debt in Q4 2024?

6d4eaa07c9c21ada7064dfafe588fffab17cf2e02ad2bf5182013520b87251fb

a519c69b5e299ddb68ee425d7907b254a4373e8dcf7a3616c76979d2edcc11de

ALBEMARLE (ALB)

Financials