CHARLOTTE, N.C., Aug. 7,
2018 /PRNewswire/ --
Second quarter 2018 highlights:
- Second quarter net sales were $853.9
million, an increase of 16% over the prior year; earnings
were $302.5 million, or $2.73 per diluted share, an increase of 197% over
the prior year
- Second quarter adjusted EBITDA was $258.6 million, an increase of 18% over the prior
year; adjusted diluted earnings per share was $1.36, an increase of 20% over the prior
year
- Closed the sale of the polyolefin catalysts and components
portion of the PCS business to W.R. Grace & Co. for net cash
proceeds of approximately $417
million on April 3, 2018
- Initiated $250 million
accelerated share repurchase program, retiring approximately 2.4
million shares in the second quarter
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
In thousands,
except per share amounts
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net sales
|
$
|
853,874
|
|
|
$
|
737,258
|
|
|
$
|
1,675,503
|
|
|
$
|
1,459,321
|
|
Net income
attributable to Albemarle Corporation
|
$
|
302,461
|
|
|
$
|
103,333
|
|
|
$
|
434,221
|
|
|
$
|
154,546
|
|
Adjusted
EBITDA
|
$
|
258,562
|
|
|
$
|
218,941
|
|
|
$
|
507,280
|
|
|
$
|
430,317
|
|
Diluted earnings per
share
|
$
|
2.73
|
|
|
$
|
0.92
|
|
|
$
|
3.90
|
|
|
$
|
1.37
|
|
Non-operating pension and OPEB items(a)
|
(0.02)
|
|
|
(0.01)
|
|
|
(0.03)
|
|
|
(0.01)
|
|
Non-recurring and other unusual items(a)
|
(1.36)
|
|
|
0.21
|
|
|
(1.22)
|
|
|
0.82
|
|
Adjusted diluted
earnings per share(b)
|
$
|
1.36
|
|
|
$
|
1.13
|
|
|
$
|
2.65
|
|
|
$
|
2.18
|
|
|
See accompanying
notes (a) through (b) to the condensed consolidated financial
information and non-GAAP reconciliations.
|
Albemarle Corporation (NYSE: ALB) reported second quarter 2018
net sales of $853.9 million, earnings
of $302.5 million and adjusted EBITDA
of $258.6 million.
"We saw strength in all three businesses in the second quarter,
with each delivering double-digit adjusted EBITDA growth," said
Luke Kissam, Albemarle's Chairman, President and CEO. "The
company grew adjusted diluted EPS by 28% over 2017, excluding
divested businesses. Our lithium capital projects continue to
progress on plan. We are confident in a strong 2018 and are raising
our guidance for the full year to $5.30 to $5.50 per
diluted share."
Outlook
Based on our strong performance in the first half of 2018, we
are increasing our guidance as follows:
|
2018
Outlook
|
|
vs Full Year
2017
|
Net sales
|
$3.3 - $3.5
billion
|
|
7% - 14%
|
Adjusted
EBITDA
|
$990 - $1,020
million
|
|
12% - 15%
|
Adjusted EPS (per
diluted share)
|
$5.30 -
$5.50
|
|
15% - 20%
|
Results
Second quarter 2018 earnings were $302.5
million, or $2.73 per diluted
share, compared to $103.3 million, or
$0.92 per diluted share in the second
quarter 2017. The increase in 2018 was primarily driven by the
$1.60 per diluted share gain on sale
of the polyolefin catalysts and components portion of the PCS
business, as well as earnings growth in each of our reportable
segments. Second quarter 2018 adjusted EBITDA increased by
$39.6 million, or 18.1%, compared to
the prior year. Second quarter 2018 adjusted net income was
$150.0 million, or $1.36 per diluted share, compared to $126.5 million, or $1.13 per diluted share, for second quarter 2017,
an increase of 20.4%. See notes to the condensed consolidated
financial information for further details. The Company reported net
sales of $853.9 million in second
quarter 2018, up 15.8% from net sales of $737.3 million in the second quarter of 2017,
driven by the favorable impact of higher sales volumes, pricing and
currency exchange impacts in each of our reportable segments,
partially offset by the impact of the divestiture of the polyolefin
catalysts and components portion of the Performance Catalyst
Solutions ("PCS") business.
For the six months ended June 30, 2018, earnings were
$434.2 million, or $3.90 per diluted share, compared to $154.5 million, or $1.37 per diluted share for the six months ended
June 30, 2017. The increase in 2018 was primarily driven by
the $1.59 per diluted share gain on
sale of the polyolefin catalysts and components portion of the PCS
business, earnings growth in each of our reportable segments, and a
loss on early extinguishment of debt of $0.34 per diluted share recorded in 2017. For the
six months ended June 30, 2018, adjusted EBITDA increased by
$77.0 million, or 17.9%, compared to
the same period 2017. For the six months ended June 30, 2018,
adjusted net income was $295.2
million, or $2.65 per diluted
share, compared to $245.5 million, or
$2.18 per diluted share, for the same
period 2017, an increase of 21.6%. See notes to the condensed
consolidated financial information for further details. The Company
reported net sales for the six months ended June 30, 2018 of
$1.68 billion, up from net sales of
$1.46 billion for the six months
ended June 30, 2017, driven by the favorable impact of higher
sales volumes in our Lithium and Catalysts segments, as well as
favorable price and currency exchange impacts in each of our
reportable segments, partially offset by the impact of the
divestiture of the polyolefin catalysts and components portion of
the PCS business.
On April 3, 2018, we closed the
sale of the polyolefin catalysts and components portion of the PCS
business to W.R. Grace & Co. for net cash proceeds of
approximately $416.7 million and
recorded an after-tax gain of $176.7
million related to the sale of this business. The
transaction includes Albemarle's
Product Development Center located in Baton Rouge, Louisiana, and operations at the
Yeosu, South Korea site. The
transaction does not include the organometallics or curatives
portion of the PCS business. The assets and liabilities of this
business are included in Assets held for sale and Liabilities held
for sale in the consolidated balance sheets as of December 31, 2017.
Quarterly Segment Results
During 2018, the PCS product category merged with the Refining
Solutions reportable segment to form a global business focused on
catalysts. As a result, our three reportable segments include: (1)
Lithium; (2) Bromine Specialties; and (3) Catalysts. For comparison
purposes, prior year periods have been reclassified to conform to
the current presentation.
Lithium reported net sales of $317.6
million in the second quarter of 2018, an increase of 30.2%
from second quarter 2017 net sales of $243.8
million. The $73.7 million
increase in net sales as compared to prior year was primarily due
to favorable pricing impacts, increased sales volumes and
$7.7 million of favorable currency
exchange impacts. Adjusted EBITDA for Lithium was $141.6 million, an increase of 22.9% from second
quarter 2017 results of $115.2
million. The $26.4 million
increase in adjusted EBITDA as compared to the prior year was
primarily due to favorable pricing impacts, increased sales volumes
and $0.8 million of favorable
currency exchange impacts, partially offset by higher royalty
payments.
Bromine Specialties reported net sales of $220.5 million in the second quarter of 2018, an
increase of 8.1% from second quarter 2017 net sales of $203.9 million. The $16.6
million increase in net sales as compared to the prior year
was primarily due to favorable pricing impacts, increased sales
volumes and $3.1 million of favorable
currency exchange impacts. Adjusted EBITDA for Bromine Specialties
was $69.4 million, an increase of
11.7% from second quarter 2017 results of $62.1 million. The $7.3
million increase in adjusted EBITDA as compared to the prior
year was primarily due to favorable pricing impacts and
$2.7 million of favorable currency
exchange impacts, partially offset by higher raw material and
production costs.
Catalysts reported net sales of $285.0
million in the second quarter of 2018, an increase of 10.3%
from net sales of $258.3 million in
the second quarter of 2017. The $26.7
million increase in net sales as compared to the prior year
was primarily due to increased sales volume, favorable pricing
impacts and $4.8 million of favorable
currency exchange impacts, which more than offset the $25.7 million impact of the divestiture of the
polyolefin catalysts and components portion of the PCS business.
Adjusted EBITDA for Catalysts was $75.1
million in the second quarter of 2018, an increase of 11.4%
from second quarter 2017 results of $67.4
million. The $7.7 million
increase in adjusted EBITDA as compared to the prior year was
primarily due to increased sales volumes, favorable pricing and
$0.3 million of favorable currency
exchange impacts, partially offset by higher material costs and the
impact of the divestiture of the polyolefin catalysts and
components portion of the PCS business of $9.8 million.
All Other net sales were $30.7
million in both the second quarter of 2018 and 2017. All
Other adjusted EBITDA was ($0.1)
million in the second quarter of 2018, a decrease of 104.1%
from second quarter 2017 results of $2.4
million. The $2.5 million
decrease in adjusted EBITDA as compared to the prior year was
primarily due to the unfavorable pricing impacts and product mix in
our fine chemistry services business.
Corporate Results
Corporate adjusted EBITDA was a charge of $27.4 million in the second quarter of 2018
compared to a charge of $28.2 million
in the second quarter of 2017. The improvement in Corporate
adjusted EBITDA was primarily due to lower selling, general and
administrative spend.
Income Taxes
In December 2017, the Tax Cuts and
Jobs Act ("TCJA") was enacted, requiring companies, among other
things, to pay a one-time transition tax on earnings of certain
foreign subsidiaries that were previously tax deferred and reducing
the U.S. federal corporate income tax rate from 35% to
21%. The SEC staff issued SAB 118, which will allow us to
record provisional amounts during a measurement period, which
should not extend beyond one year from the enactment date. In the
six months ended June 30, 2018, we recorded a discrete tax
benefit of $2.8 million to adjust
amounts previously recorded for the one-time transition tax and a
discrete tax benefit of $3.7 million
for other adjustments.
Our effective income tax rates for the second quarter of 2018
and 2017 of 21.5% and 19.0%, respectively, are influenced by
non-recurring, other unusual and non-operating pension and OPEB
items (see notes to the condensed consolidated financial
information). The increase in the effective tax rate in the second
quarter of 2018 compared to 2017 was impacted by a variety of
factors, primarily stemming from a change in the geographic mix of
earnings. Our adjusted effective income tax rates, which exclude
non-recurring, other unusual and non-operating pension and OPEB
items, were 24.4% and 19.1% for the second quarter of 2018 and
2017, respectively, and continue to be influenced by the level and
geographic mix of income. Our effective income tax rates for the
six months ended June 30, 2018 and 2017 were 19.7% and 20.0%,
respectively, and our adjusted effective income tax rates for the
six months ended June 30, 2018 and 2017 were 23.8% and 20.7%,
respectively.
Cash Flow
Our cash from operations was approximately $223.9 million for the six months ended
June 30, 2018, an increase of $278.3
million versus the same period in 2017, primarily due to
changes in working capital, including the payment of approximately
$255 million in taxes related to the
sale of the Chemetall Surface Treatment business in 2017, as well
as increased earnings in each of our reportable segments and
increased dividends received from unconsolidated investments in
2018. Capital expenditures were $280.9
million as compared to $97.8
million in the first six months of 2017, with the increase
driven largely by expansion investment in our Lithium business. We
had $908.1 million in cash and cash
equivalents at June 30, 2018, as compared to $1.14 billion at December
31, 2017. During the first six months of 2018, cash on hand,
cash provided by operations and net proceeds from divestitures
funded $213.3 million of commercial
paper note repayments, net of borrowings, $280.9 million of capital expenditures for plant,
machinery and equipment, dividends to shareholders of $72.5 million and a $250.0
million accelerated share repurchase program, of which we
received and retired approximately 2.4 million shares of our common
stock during the second quarter. Any remaining shares to be
delivered under this accelerated share repurchase program will be
received and retired by the end of the third quarter of 2018.
Earnings Call
The Company's performance for the second quarter ended
June 30, 2018 will be discussed on a conference call at
9:00 AM Eastern time on
August 8, 2018. The call can be accessed by dialing
800-219-3192 (International Dial-In # 617-597-5412), and entering
conference ID 17275571. The Company's earnings presentation and
supporting material can be accessed through Albemarle's website under Investors at
www.albemarle.com.
About Albemarle
Albemarle Corporation (NYSE: ALB), headquartered in Charlotte, NC, is a global specialty chemicals
company with leading positions in lithium, bromine and refining
catalysts. We power the potential of companies in many of the
world's largest and most critical industries, from energy and
communications to transportation and electronics. Working
side-by-side with our customers, we develop value-added, customized
solutions that make them more competitive. Our solutions combine
the finest technology and ingredients with the knowledge and
know-how of our highly experienced and talented team of operators,
scientists and engineers.
Discovering and implementing new and better performance-based
sustainable solutions is what motivates all of us. We think beyond
business-as-usual to drive innovations that create lasting value.
Albemarle employs approximately
5,000 people and serves customers in approximately 100 countries.
We regularly post information to www.albemarle.com, including
notification of events, news, financial performance, investor
presentations and webcasts, non-GAAP reconciliations, SEC filings
and other information regarding our company, its businesses and the
markets it serves.
Forward-Looking Statements
Some of the information presented in this press release, the
conference call and discussions that follow, including, without
limitation, product development, changes in productivity, market
trends, price, expected growth, earnings and demand for our
products, input costs, surcharges, tax rates, stock repurchases,
dividends, cash flow generation, costs and cost synergies,
portfolio diversification, economic trends, outlook and all other
information relating to matters that are not historical facts may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Actual results
could differ materially from the views expressed. Factors that
could cause actual results to differ materially from the outlook
expressed or implied in any forward-looking statement include,
without limitation: changes in economic and business conditions;
changes in financial and operating performance of our major
customers and industries and markets served by us; the timing of
orders received from customers; the gain or loss of significant
customers; competition from other manufacturers; changes in the
demand for our products or the end-user markets in which our
products are sold; limitations or prohibitions on the manufacture
and sale of our products; availability of raw materials; increases
in the cost of raw materials and energy, and our ability to pass
through such increases to our customers; changes in our markets in
general; fluctuations in foreign currencies; changes in laws and
government regulation impacting our operations or our products; the
occurrence of regulatory proceedings, claims or litigation; the
occurrence of cyber-security breaches, terrorist attacks,
industrial accidents, natural disasters or climate change; the
inability to maintain current levels of product or premises
liability insurance or the denial of such coverage; political
unrest affecting the global economy, including adverse effects form
terrorism or hostilities; political instability affecting our
manufacturing operations or joint ventures; changes in accounting
standards; the inability to achieve results from our global
manufacturing cost reduction initiatives as well as our ongoing
continuous improvement and rationalization programs; changes in the
jurisdictional mix of our earnings and changes in tax laws and
rates; changes in monetary policies, inflation or interest rates
that may impact our ability to raise capital or increase our cost
of funds, impact the performance of our pension fund investments
and increase our pension expense and funding obligations;
volatility and uncertainties in the debt and equity markets;
technology or intellectual property infringement, including
cyber-security breaches, and other innovation risks; decisions we
may make in the future; the ability to successfully execute,
operate and integrate acquisitions and divestitures; and the other
factors detailed from time to time in the reports we file with the
SEC, including those described under "Risk Factors" in our Annual
Report on Form 10-K and our Quarterly Reports on Form 10-Q. These
forward-looking statements speak only as of the date of this press
release. We assume no obligation to provide any revisions to any
forward-looking statements should circumstances change, except as
otherwise required by securities and other applicable laws.
Albemarle Corporation
and Subsidiaries
Consolidated
Statements of Income
(In Thousands Except
Per Share Amounts) (Unaudited)
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net
sales
|
$
|
853,874
|
|
|
$
|
737,258
|
|
|
$
|
1,675,503
|
|
|
$
|
1,459,321
|
|
Cost of goods
sold
|
542,518
|
|
|
465,297
|
|
|
1,059,168
|
|
|
932,404
|
|
Gross
profit
|
311,356
|
|
|
271,961
|
|
|
616,335
|
|
|
526,917
|
|
Selling, general and
administrative expenses
|
123,637
|
|
|
116,585
|
|
|
225,007
|
|
|
225,513
|
|
Research and
development expenses
|
16,074
|
|
|
17,337
|
|
|
37,060
|
|
|
41,660
|
|
Gain on sale of
business
|
(218,705)
|
|
|
—
|
|
|
(218,705)
|
|
|
—
|
|
Operating
profit
|
390,350
|
|
|
138,039
|
|
|
572,973
|
|
|
259,744
|
|
Interest and
financing expenses
|
(13,308)
|
|
|
(14,590)
|
|
|
(26,846)
|
|
|
(83,103)
|
|
Other expenses,
net
|
(5,223)
|
|
|
(1,678)
|
|
|
(35,699)
|
|
|
(1,413)
|
|
Income before income
taxes and equity in net income of
unconsolidated investments
|
371,819
|
|
|
121,771
|
|
|
510,428
|
|
|
175,228
|
|
Income tax
expense
|
80,102
|
|
|
23,130
|
|
|
100,463
|
|
|
35,101
|
|
Income before equity
in net income of unconsolidated
investments
|
291,717
|
|
|
98,641
|
|
|
409,965
|
|
|
140,127
|
|
Equity in net income
of unconsolidated investments (net of
tax)
|
18,969
|
|
|
15,048
|
|
|
39,646
|
|
|
36,219
|
|
Net income
|
310,686
|
|
|
113,689
|
|
|
449,611
|
|
|
176,346
|
|
Net income
attributable to noncontrolling interests
|
(8,225)
|
|
|
(10,356)
|
|
|
(15,390)
|
|
|
(21,800)
|
|
Net income
attributable to Albemarle Corporation
|
$
|
302,461
|
|
|
$
|
103,333
|
|
|
$
|
434,221
|
|
|
$
|
154,546
|
|
Basic earnings per
share
|
$
|
2.76
|
|
|
$
|
0.93
|
|
|
$
|
3.94
|
|
|
$
|
1.39
|
|
Diluted earnings per
share
|
$
|
2.73
|
|
|
$
|
0.92
|
|
|
$
|
3.90
|
|
|
$
|
1.37
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding – basic
|
109,671
|
|
|
110,686
|
|
|
110,176
|
|
|
111,336
|
|
Weighted-average
common shares outstanding – diluted
|
110,659
|
|
|
112,105
|
|
|
111,263
|
|
|
112,697
|
|
|
See accompanying
notes to the condensed consolidated financial
information.
|
Albemarle Corporation
and Subsidiaries
Condensed
Consolidated Balance Sheets
(In Thousands)
(Unaudited)
|
|
|
|
June
30,
|
|
December
31,
|
|
2018
|
|
2017
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
|
908,144
|
|
|
$
|
1,137,303
|
|
Other current
assets
|
1,374,926
|
|
|
1,301,108
|
|
Assets held for
sale
|
—
|
|
|
39,152
|
|
Total current
assets
|
2,283,070
|
|
|
2,477,563
|
|
Property, plant and
equipment
|
4,375,335
|
|
|
4,124,335
|
|
Less accumulated
depreciation and amortization
|
1,705,675
|
|
|
1,631,025
|
|
Net property, plant
and equipment
|
2,669,660
|
|
|
2,493,310
|
|
Noncurrent assets
held for sale
|
—
|
|
|
139,813
|
|
Other assets and
intangibles
|
2,585,633
|
|
|
2,640,086
|
|
Total
assets
|
$
|
7,538,363
|
|
|
$
|
7,750,772
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current portion of
long-term debt
|
$
|
208,681
|
|
|
$
|
422,012
|
|
Other current
liabilities
|
832,980
|
|
|
776,975
|
|
Liabilities held for
sale
|
—
|
|
|
1,938
|
|
Total current
liabilities
|
1,041,661
|
|
|
1,200,925
|
|
Long-term
debt
|
1,406,724
|
|
|
1,415,360
|
|
Noncurrent
liabilities held for sale
|
—
|
|
|
614
|
|
Other noncurrent
liabilities
|
886,486
|
|
|
945,788
|
|
Deferred income
taxes
|
366,212
|
|
|
370,389
|
|
Albemarle Corporation
shareholders' equity
|
3,693,576
|
|
|
3,674,549
|
|
Noncontrolling
interests
|
143,704
|
|
|
143,147
|
|
Total liabilities and
equity
|
$
|
7,538,363
|
|
|
$
|
7,750,772
|
|
|
See accompanying
notes to the condensed consolidated financial
information.
|
Albemarle Corporation
and Subsidiaries
Selected Consolidated
Cash Flow Data
(In Thousands)
(Unaudited)
|
|
|
|
Six Months
Ended
|
|
June
30,
|
|
2018
|
|
2017
|
Cash and cash
equivalents at beginning of year
|
$
|
1,137,303
|
|
|
$
|
2,269,756
|
|
Cash and cash
equivalents at end of period
|
$
|
908,144
|
|
|
$
|
1,006,945
|
|
Sources of cash
and cash equivalents:
|
|
|
|
Net income
|
$
|
449,611
|
|
|
$
|
176,346
|
|
Cash proceeds from
divestitures, net
|
416,711
|
|
|
6,857
|
|
Other borrowings,
net
|
—
|
|
|
58,886
|
|
Dividends received
from unconsolidated investments and nonmarketable
securities
|
30,045
|
|
|
8,454
|
|
Proceeds from exercise
of stock options
|
1,288
|
|
|
3,337
|
|
Uses of cash and
cash equivalents:
|
|
|
|
Working capital
changes
|
(91,189)
|
|
|
(353,138)
|
|
Capital
expenditures
|
(280,945)
|
|
|
(97,765)
|
|
Acquisitions, net of
cash acquired
|
(7,643)
|
|
|
(39,525)
|
|
Repayments of
long-term debt
|
—
|
|
|
(751,209)
|
|
Repurchases of common
stock
|
(250,000)
|
|
|
(250,000)
|
|
Repayments of other
borrowings, net
|
(211,833)
|
|
|
—
|
|
Pension and
postretirement contributions
|
(7,089)
|
|
|
(6,288)
|
|
Dividends paid to
shareholders
|
(72,484)
|
|
|
(69,762)
|
|
Fees related to early
extinguishment of debt
|
—
|
|
|
(46,959)
|
|
Dividends paid to
noncontrolling interests
|
(7,378)
|
|
|
(17,930)
|
|
Non-cash and other
items:
|
|
|
|
Depreciation and
amortization
|
100,804
|
|
|
94,192
|
|
Gain on sale of
business
|
(218,705)
|
|
|
—
|
|
Gain on
acquisition
|
—
|
|
|
(7,433)
|
|
Pension and
postretirement benefit
|
(1,793)
|
|
|
(7)
|
|
Loss on early
extinguishment of debt
|
—
|
|
|
52,801
|
|
Deferred income
taxes
|
30,708
|
|
|
(3,204)
|
|
Equity in net income
of unconsolidated investments (net of tax)
|
(39,646)
|
|
|
(36,219)
|
|
|
See accompanying
notes to the condensed consolidated financial
information.
|
Notes to the Condensed Consolidated Financial Information
(a)
|
See Non-GAAP
Reconciliations for a description of the Non-operating pension and
OPEB items and Non-recurring and other unusual items.
|
|
|
(b)
|
Totals may not add
due to rounding.
|
Additional Information
It should be noted that adjusted net income attributable to
Albemarle Corporation, adjusted diluted earnings per share,
non-operating pension and OPEB items per diluted share,
non-recurring and other unusual items per diluted share, adjusted
effective income tax rates, EBITDA, adjusted EBITDA, EBITDA margin
and adjusted EBITDA margin are financial measures that are not
required by, or presented in accordance with, accounting principles
generally accepted in the United
States, or GAAP. These non-GAAP measures should not be
considered as alternatives to Net income attributable to Albemarle
Corporation ("earnings"). These measures are presented here to
provide additional useful measurements to review our operations,
provide transparency to investors and enable period-to-period
comparability of financial performance. The Company's chief
operating decision maker uses these measures to assess the ongoing
performance of the Company and its segments, as well as for
business and enterprise planning purposes.
A description of other non-GAAP financial measures that we use
to evaluate our operations and financial performance, and
reconciliation of these non-GAAP financial measures to the most
directly comparable financial measures calculated and reported in
accordance with GAAP can be found on the following pages of this
press release, which is also posted in the Investors section of our
website at www.albemarle.com. The Company does not provide a
reconciliation of forward-looking non-GAAP financial measures to
the most directly comparable financial measures calculated and
reported in accordance with GAAP, as the Company is unable to
estimate significant non-recurring or unusual items without
unreasonable effort. The amounts and timing of these items are
uncertain and could be material to the Company's results calculated
in accordance with GAAP.
Albemarle Corporation
and Subsidiaries
Consolidated Summary
of Segment Results
(In Thousands)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net
sales:
|
|
|
|
|
|
|
|
Lithium
|
$
|
317,563
|
|
|
$
|
243,821
|
|
|
$
|
615,595
|
|
|
$
|
460,050
|
|
Bromine
Specialties
|
220,514
|
|
|
203,945
|
|
|
446,153
|
|
|
423,136
|
|
Catalysts
|
284,966
|
|
|
258,255
|
|
|
545,683
|
|
|
511,813
|
|
All Other
|
30,748
|
|
|
30,704
|
|
|
67,913
|
|
|
63,123
|
|
Corporate
|
83
|
|
|
533
|
|
|
159
|
|
|
1,199
|
|
Total net
sales
|
$
|
853,874
|
|
|
$
|
737,258
|
|
|
$
|
1,675,503
|
|
|
$
|
1,459,321
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA:
|
|
|
|
|
|
|
|
Lithium
|
$
|
141,617
|
|
|
$
|
115,200
|
|
|
$
|
272,631
|
|
|
$
|
215,052
|
|
Bromine
Specialties
|
69,367
|
|
|
62,075
|
|
|
139,336
|
|
|
130,563
|
|
Catalysts
|
75,102
|
|
|
67,427
|
|
|
142,932
|
|
|
137,176
|
|
All Other
|
(101)
|
|
|
2,444
|
|
|
3,761
|
|
|
7,600
|
|
Corporate
|
(27,423)
|
|
|
(28,205)
|
|
|
(51,380)
|
|
|
(60,074)
|
|
Total adjusted
EBITDA
|
$
|
258,562
|
|
|
$
|
218,941
|
|
|
$
|
507,280
|
|
|
$
|
430,317
|
|
|
See accompanying
non-GAAP reconciliations below.
|
ALBEMARLE
CORPORATION AND SUBSIDIARIES
Non-GAAP
Reconciliations
(Unaudited)
See below for a reconciliation of adjusted net income
attributable to Albemarle Corporation, EBITDA and adjusted EBITDA,
the non-GAAP financial measures, to Net income attributable to
Albemarle Corporation ("earnings"), the most directly comparable
financial measure calculated and reported in accordance with GAAP.
Adjusted earnings is defined as earnings before the non-recurring,
other unusual and non-operating pension and OPEB items as listed
below. EBITDA is defined as earnings before interest and financing
expenses, income taxes, and depreciation and amortization. Adjusted
EBITDA is defined as EBITDA and the non-recurring, other unusual
and non-operating pension and OPEB items as listed below.
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
In thousands, except
percentages and per share amounts
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net income
attributable to Albemarle Corporation
|
$
|
302,461
|
|
|
$
|
103,333
|
|
|
$
|
434,221
|
|
|
$
|
154,546
|
|
Add back:
|
|
|
|
|
|
|
|
Non-operating pension
and OPEB items (net of tax)
|
(1,873)
|
|
|
(589)
|
|
|
(3,739)
|
|
|
(1,399)
|
|
Non-recurring and
other unusual items (net of tax)
|
(150,618)
|
|
|
23,738
|
|
|
(135,299)
|
|
|
92,343
|
|
Adjusted net income
attributable to Albemarle Corporation
|
$
|
149,970
|
|
|
$
|
126,482
|
|
|
$
|
295,183
|
|
|
$
|
245,490
|
|
|
|
|
|
|
|
|
|
Adjusted diluted
earnings per share
|
$
|
1.36
|
|
|
$
|
1.13
|
|
|
$
|
2.65
|
|
|
$
|
2.18
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding – diluted
|
110,659
|
|
|
112,105
|
|
|
111,263
|
|
|
112,697
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Albemarle Corporation
|
$
|
302,461
|
|
|
$
|
103,333
|
|
|
$
|
434,221
|
|
|
$
|
154,546
|
|
Add back:
|
|
|
|
|
|
|
|
Interest and financing
expenses
|
13,308
|
|
|
14,590
|
|
|
26,846
|
|
|
83,103
|
|
Income tax
expense
|
80,102
|
|
|
23,130
|
|
|
100,463
|
|
|
35,101
|
|
Depreciation and
amortization
|
50,474
|
|
|
49,122
|
|
|
100,804
|
|
|
94,192
|
|
EBITDA
|
446,345
|
|
|
190,175
|
|
|
662,334
|
|
|
366,942
|
|
Non-operating pension
and OPEB items
|
(2,204)
|
|
|
(1,053)
|
|
|
(4,401)
|
|
|
(2,116)
|
|
Non-recurring and
other unusual items (excluding items associated
with interest expense)
|
(185,579)
|
|
|
29,819
|
|
|
(150,653)
|
|
|
65,491
|
|
Adjusted
EBITDA
|
$
|
258,562
|
|
|
$
|
218,941
|
|
|
$
|
507,280
|
|
|
$
|
430,317
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
853,874
|
|
|
$
|
737,258
|
|
|
$
|
1,675,503
|
|
|
$
|
1,459,321
|
|
EBITDA
margin
|
52.3
|
%
|
|
25.8
|
%
|
|
39.5
|
%
|
|
25.1
|
%
|
Adjusted EBITDA
margin
|
30.3
|
%
|
|
29.7
|
%
|
|
30.3
|
%
|
|
29.5
|
%
|
See below for a reconciliation of adjusted EBITDA on a segment
basis, the non-GAAP financial measure, to Net income attributable
to Albemarle Corporation, the most directly comparable financial
measure calculated and reporting in accordance with GAAP (in
thousands, except percentages).
|
Lithium
|
|
Bromine
Specialties
|
|
Catalysts
|
|
Reportable
Segments Total
|
|
All
Other
|
|
Corporate
|
|
Consolidated
Total
|
|
% of
Net Sales
|
Three months ended
June 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Albemarle
Corporation
|
$
|
117,292
|
|
|
$
|
59,673
|
|
|
$
|
280,887
|
|
|
$
|
457,852
|
|
|
$
|
(2,079)
|
|
|
$
|
(153,312)
|
|
|
$
|
302,461
|
|
|
35.4
|
%
|
Depreciation and
amortization
|
24,325
|
|
|
9,694
|
|
|
12,920
|
|
|
46,939
|
|
|
1,978
|
|
|
1,557
|
|
|
50,474
|
|
|
5.9
|
%
|
Non-recurring and
other unusual items
|
—
|
|
|
—
|
|
|
(218,705)
|
|
|
(218,705)
|
|
|
—
|
|
|
33,126
|
|
|
(185,579)
|
|
|
(21.7)
|
%
|
Interest and
financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,308
|
|
|
13,308
|
|
|
1.6
|
%
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80,102
|
|
|
80,102
|
|
|
9.4
|
%
|
Non-operating pension
and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,204)
|
|
|
(2,204)
|
|
|
(0.3)
|
%
|
Adjusted
EBITDA
|
$
|
141,617
|
|
|
$
|
69,367
|
|
|
$
|
75,102
|
|
|
$
|
286,086
|
|
|
$
|
(101)
|
|
|
$
|
(27,423)
|
|
|
$
|
258,562
|
|
|
30.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
June 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Albemarle
Corporation
|
$
|
81,819
|
|
|
$
|
51,739
|
|
|
$
|
53,994
|
|
|
$
|
187,552
|
|
|
$
|
152
|
|
|
$
|
(84,371)
|
|
|
$
|
103,333
|
|
|
14.0
|
%
|
Depreciation and
amortization
|
21,460
|
|
|
10,336
|
|
|
13,433
|
|
|
45,229
|
|
|
2,292
|
|
|
1,601
|
|
|
49,122
|
|
|
6.7
|
%
|
Non-recurring and
other unusual items
|
11,921
|
|
|
—
|
|
|
—
|
|
|
11,921
|
|
|
—
|
|
|
17,898
|
|
|
29,819
|
|
|
4.0
|
%
|
Interest and
financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,590
|
|
|
14,590
|
|
|
2.0
|
%
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,130
|
|
|
23,130
|
|
|
3.1
|
%
|
Non-operating pension
and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,053)
|
|
|
(1,053)
|
|
|
(0.1)
|
%
|
Adjusted
EBITDA
|
$
|
115,200
|
|
|
$
|
62,075
|
|
|
$
|
67,427
|
|
|
$
|
244,702
|
|
|
$
|
2,444
|
|
|
$
|
(28,205)
|
|
|
$
|
218,941
|
|
|
29.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Albemarle
Corporation
|
$
|
225,626
|
|
|
$
|
119,209
|
|
|
$
|
336,547
|
|
|
$
|
681,382
|
|
|
$
|
(319)
|
|
|
$
|
(246,842)
|
|
|
$
|
434,221
|
|
|
25.9
|
%
|
Depreciation and
amortization
|
48,390
|
|
|
20,127
|
|
|
25,090
|
|
|
93,607
|
|
|
4,080
|
|
|
3,117
|
|
|
100,804
|
|
|
6.0
|
%
|
Non-recurring and
other unusual items
|
(1,385)
|
|
|
—
|
|
|
(218,705)
|
|
|
(220,090)
|
|
|
—
|
|
|
69,437
|
|
|
(150,653)
|
|
|
(9.0)
|
%
|
Interest and
financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,846
|
|
|
26,846
|
|
|
1.6
|
%
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,463
|
|
|
100,463
|
|
|
6.0
|
%
|
Non-operating pension
and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,401)
|
|
|
(4,401)
|
|
|
(0.2)
|
%
|
Adjusted
EBITDA
|
$
|
272,631
|
|
|
$
|
139,336
|
|
|
$
|
142,932
|
|
|
$
|
554,899
|
|
|
$
|
3,761
|
|
|
$
|
(51,380)
|
|
|
$
|
507,280
|
|
|
30.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Albemarle
Corporation
|
$
|
159,433
|
|
|
$
|
110,433
|
|
|
$
|
110,960
|
|
|
$
|
380,826
|
|
|
$
|
3,398
|
|
|
$
|
(229,678)
|
|
|
$
|
154,546
|
|
|
10.6
|
%
|
Depreciation and
amortization
|
40,525
|
|
|
20,130
|
|
|
26,216
|
|
|
86,871
|
|
|
4,202
|
|
|
3,119
|
|
|
94,192
|
|
|
6.5
|
%
|
Non-recurring and
other unusual items
(excluding items associated with interest
expense)
|
15,094
|
|
|
—
|
|
|
—
|
|
|
15,094
|
|
|
—
|
|
|
50,397
|
|
|
65,491
|
|
|
4.5
|
%
|
Interest and
financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
83,103
|
|
|
83,103
|
|
|
5.7
|
%
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,101
|
|
|
35,101
|
|
|
2.4
|
%
|
Non-operating pension
and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,116)
|
|
|
(2,116)
|
|
|
(0.2)
|
%
|
Adjusted
EBITDA
|
$
|
215,052
|
|
|
$
|
130,563
|
|
|
$
|
137,176
|
|
|
$
|
482,791
|
|
|
$
|
7,600
|
|
|
$
|
(60,074)
|
|
|
$
|
430,317
|
|
|
29.5
|
%
|
Non-operating pension and OPEB items, consisting of MTM
actuarial gains/losses, settlements/curtailments, interest cost and
expected return on assets, are not allocated to our operating
segments and are included in the Corporate category. In addition,
we believe that these components of pension cost are mainly driven
by market performance, and we manage these separately from the
operational performance of our businesses. In accordance with GAAP,
these non-operating pension and OPEB items are included in Other
expenses, net. Non-operating pension and OPEB items were as follows
(in thousands):
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Interest
cost
|
$
|
8,558
|
|
|
$
|
8,905
|
|
|
$
|
17,127
|
|
|
$
|
17,778
|
|
Expected return on
assets
|
(10,762)
|
|
|
(9,958)
|
|
|
(21,528)
|
|
|
(19,894)
|
|
Total
|
$
|
(2,204)
|
|
|
$
|
(1,053)
|
|
|
$
|
(4,401)
|
|
|
$
|
(2,116)
|
|
In addition to the non-operating pension and OPEB items
disclosed above, we have identified certain other items and
excluded them from our adjusted net income calculation for the
periods presented. A listing of these items, as well as a detailed
description of each follows below (per diluted share):
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Utilization of
inventory markup(1)
|
$
|
—
|
|
|
$
|
0.08
|
|
|
$
|
—
|
|
|
$
|
0.16
|
|
Restructuring and
other(2)
|
—
|
|
|
0.02
|
|
|
—
|
|
|
0.11
|
|
Acquisition and
integration related costs(3)
|
0.05
|
|
|
0.04
|
|
|
0.06
|
|
|
0.15
|
|
Albemarle Foundation
contribution(4)
|
0.11
|
|
|
—
|
|
|
0.11
|
|
|
—
|
|
Gain on sale of
business(5)
|
(1.60)
|
|
|
—
|
|
|
(1.59)
|
|
|
—
|
|
Gain on
acquisition(6)
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.05)
|
|
Legal
accrual(7)
|
0.07
|
|
|
—
|
|
|
0.19
|
|
|
—
|
|
Loss on
extinguishment of debt(8)
|
—
|
|
|
—
|
|
|
—
|
|
|
0.34
|
|
Multiemployer plan
shortfall contributions(9)
|
—
|
|
|
0.03
|
|
|
—
|
|
|
0.03
|
|
Other(10)
|
0.01
|
|
|
0.02
|
|
|
0.12
|
|
|
0.05
|
|
Discrete tax
items(11)
|
—
|
|
|
0.02
|
|
|
(0.11)
|
|
|
0.03
|
|
Total non-recurring
and other unusual items
|
$
|
(1.36)
|
|
|
$
|
0.21
|
|
|
$
|
(1.22)
|
|
|
$
|
0.82
|
|
(1)
|
In connection with
the acquisition of the lithium hydroxide and lithium carbonate
conversion business of Jiangxi Jiangli New Materials Science and
Technology Co. Ltd. ("Jiangli New Materials"), the Company valued
inventory purchased from Jiangli New Materials at fair value, which
resulted in a markup of the underlying net book value of the
inventory totaling approximately $23.1 million. The inventory
markup was expensed over the estimated remaining selling period.
For the three and six months ended June 30, 2017, $11.9 million and
$22.5 million ($8.9 million and $17.5 million after income taxes,
or $0.08 and $0.16 per share), respectively, was included in Cost
of goods sold related to the utilization of the inventory
markup.
|
|
|
(2)
|
The three and six
months ended June 30, 2017 included restructuring costs at several
locations, primarily at our Lithium sites in Germany. These
restructuring costs are included in the consolidated statements of
income as follows (in millions, except per share
amounts):
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June 30,
2017
|
|
June 30,
2017
|
Restructuring and
other costs:
|
|
|
|
Cost of goods
sold
|
$
|
—
|
|
|
$
|
2.9
|
|
Selling, general and
administrative expenses
|
4.2
|
|
|
8.4
|
|
Research and
development expenses
|
—
|
|
|
5.8
|
|
Total
|
$
|
4.2
|
|
|
$
|
17.1
|
|
Total restructuring
and other costs, after income taxes
|
$
|
2.8
|
|
|
$
|
13.0
|
|
Total restructuring
and other costs, per diluted share
|
$
|
0.02
|
|
|
$
|
0.11
|
|
(3)
|
Acquisition and
integration related costs for the three and six months ended June
30, 2018 and 2017 related to various significant projects.
Acquisition and integration related costs are included in the
consolidated statements of income as follows (in millions, except
per share amounts):
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Acquisition and
integration related costs:
|
|
|
|
|
|
|
|
Cost of goods
sold
|
$
|
1.0
|
|
|
$
|
1.8
|
|
|
$
|
1.9
|
|
|
$
|
10.7
|
|
Selling, general and
administrative expenses
|
5.5
|
|
|
4.7
|
|
|
6.8
|
|
|
10.1
|
|
Total
|
$
|
6.5
|
|
|
$
|
6.5
|
|
|
$
|
8.7
|
|
|
$
|
20.8
|
|
Total acquisition and
integration related costs,
after income taxes
|
$
|
5.2
|
|
|
$
|
4.8
|
|
|
$
|
7.1
|
|
|
$
|
17.6
|
|
Total acquisition and
integration related costs,
per diluted share
|
$
|
0.05
|
|
|
$
|
0.04
|
|
|
$
|
0.06
|
|
|
$
|
0.15
|
|
(4)
|
Included in Selling,
general and administrative expenses for the three and six months
ended June 30, 2018 is a $15.0 million ($11.5 million after income
taxes, or $0.11 per share) charitable contribution, using a portion
of the proceeds received from the sale of the polyolefin catalysts
and components portion of the PCS business, to the Albemarle
Foundation, a non-profit organization that sponsors grants, health
and social projects, educational initiatives, disaster relief,
matching gift programs, scholarships and other charitable
initiatives in locations where our employees live and operate. This
contribution is in addition to the normal annual contribution made
to the Albemarle Foundation by the Company, and is significant in
size and nature in that it is intended to provide more long-term
benefits in the communities where we live and operate.
|
|
|
(5)
|
Included in Gain on
sale of business, for the three and six months ended June 30, 2018
is $218.7 million ($176.7 million after discrete income taxes, or
$1.60 per share and $1.59 per share for the three and six months
ended June 30, 2018, respectively, due to differences in the
weighted average share count between periods) related to the sale
of the polyolefin catalysts and components portion of the PCS
business.
|
|
|
(6)
|
Included in Other
expenses, net for the six months ended June 30, 2017 is $7.4
million ($6.0 million after income taxes, or $0.05 per share)
relating to the acquisition of the remaining 50% interest in the
Sales de Magnesio Ltda. joint venture in Chile. The gain was
calculated based on the difference between the purchase price and
the book value of the investment.
|
|
|
(7)
|
Included in Other
expenses, net, for the three and six months ended June 30, 2018 is
a $10.4 million ($8.0 million after income taxes, or $0.07 per
share) legal accrual resulting from a proposed settlement in a
legal matter related to guarantees from a previously disposed
business. Also included in Other expenses, net, for the six months
ended June 30, 2018 is a $17.6 million ($13.6 million after income
taxes, or $0.12 per share) legal accrual relating to a jury
rendered verdict against Albemarle related to certain business
concluded under a 2014 sales agreement for products that Albemarle
no longer manufactures. Albemarle is currently evaluating its
appeal options.
|
|
|
(8)
|
Included in Interest
and financing expenses for the six months ended June 30, 2017 is a
loss on early extinguishment of debt of $52.8 million ($38.1
million after income taxes, or $0.34 per share) related to the
tender premiums, fees, unamortized discounts and unamortized
deferred financings costs from the redemption of the 3.00% Senior
notes, €307.0 million of the 1.875% Senior notes and $174.7 million
of the 4.50% Senior notes.
|
|
|
(9)
|
Included in Selling,
general and administrative expenses for the three and six months
ended June 30, 2017 is $2.0 million ($1.4 million after income
taxes, or $0.01 per share) for increased capital reserve
contributions to a multiemployer plan, which is subject to a
financial improvement plan. In addition, capital reserve
contributions for this multiemployer plan of $2.9 million ($2.2
million after income taxes, or $0.02 per share), included in Other
expenses, net, have been made to indemnify previously divested
businesses.
|
|
|
(10)
|
Other adjustments for
the three months ended June 30, 2018 included charges of $1.2
million ($1.0 million after income taxes, or $0.01 per share)
related to the revision of previously recorded expenses of disposed
businesses recorded in Other expenses, net.
|
|
|
|
Other adjustments for
the six months ended June 30, 2018 included amounts recorded
in:
|
|
- Cost of goods sold - $1.1 million for the
write-off of fixed assets related to a major capacity expansion in
our Jordanian joint venture.
- Selling, general and administrative expenses
- $1.4 million gain related to a refund from Chilean authorities
due to an overpayment made in a prior year.
- Other expenses, net - $15.6 million related
to environmental charges related to a site formerly owned by
Albemarle and $1.0 million of charges related to the revision of
previously recorded expenses of disposed businesses.
|
|
After income taxes,
these charges totaled $12.9 million, or $0.12 per share.
|
|
|
|
Other adjustments for
the three months ended June 30, 2017 included amounts recorded
in:
|
|
- Selling, general and administrative expenses
- $1.0 million gain related to a reversal of an accrual recorded as
part of purchase accounting from a previous acquisition.
- Other expenses, net - $2.0 million of charges
associated with the final settlements of previously disposed
businesses and $1.2 million of tax indemnification expenses
primarily related to a competent authority agreement for a
previously disposed business.
|
|
After income taxes,
these charges totaled $1.6 million, or $0.02 per share.
|
|
|
|
Other adjustments for
the six months ended June 30, 2017 included amounts recorded
in:
|
|
- Selling, general and administrative expenses
- $1.0 million gain related to a reversal of an accrual recorded as
part of purchase accounting from a previous acquisition.
- Other expenses, net - $4.1 million of charges
associated with the final settlements of previously disposed
businesses, $3.2 million of asset retirement obligation charges
related to the revision of an estimate at a site formerly owned by
Albemarle and $1.2 million of tax indemnification expenses
primarily related to a competent authority agreement for a
previously disposed business.
|
|
After income taxes,
these charges totaled $5.6 million, or $0.05 per share.
|
|
|
(11)
|
Included in Income
tax expense for the three and six months ended June 30, 2018 are
discrete net tax expenses (benefits), excluding the discrete tax
expense on the gain of sale of business noted above, of $0.3
million, or less than $0.01 per share, and ($11.8) million, or
($0.11) per share, respectively. The net expense for the three
months is primarily related to $8.5 million for a valuation
allowance recorded due to a foreign restructuring plan, partially
offset by an $8.0 million benefit for tax accounting method
changes. The net benefit for the six months is primarily related to
an $8.0 million benefit for tax accounting method changes, a $6.5
million benefit for adjustments related to the accounting for the
TCJA and $7.2 million excess tax benefits realized from stock-based
compensation arrangements, partially offset by $8.5 million for a
valuation allowance recorded due to a foreign restructuring
plan.
|
|
|
|
Included in Income
tax expense for the three and six months ended June 30, 2017 are
discrete net tax expenses of $2.2 million, or $0.02 per share, and
$3.1 million, or $0.03 per share, respectively. The net expense for
the three months is primarily related to foreign rate changes of
$13.9 million, partially offset by a $9.8 million benefit from the
release of valuation allowances due to a foreign restructuring
plan. The net expense for the six months is primarily related to
foreign rate changes of $13.1 million and a loss from prior year
true up of $5.1 million, partially offset by a $9.8 million benefit
from the release of valuation allowances due to a foreign
restructuring plan and a $4.7 million benefit from excess tax
benefits realized from stock-based compensation
arrangements.
|
See below 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 (in thousands, except
percentages).
|
Income before
income taxes and
equity in net income
of unconsolidated
investments
|
|
Income tax
expense
|
|
Effective
income
tax rate
|
Three months ended
June 30, 2018:
|
|
|
|
|
|
As
reported
|
$
|
371,819
|
|
|
$
|
80,102
|
|
|
21.5
|
%
|
Non-recurring, other
unusual and non-operating pension and OPEB
items
|
(187,783)
|
|
|
(35,292)
|
|
|
|
As
adjusted
|
$
|
184,036
|
|
|
$
|
44,810
|
|
|
24.4
|
%
|
|
|
|
|
|
|
Three months ended
June 30, 2017:
|
|
|
|
|
|
As
reported
|
$
|
121,771
|
|
|
$
|
23,130
|
|
|
19.0
|
%
|
Non-recurring, other
unusual and non-operating pension and OPEB
items
|
28,766
|
|
|
5,617
|
|
|
|
As
adjusted
|
$
|
150,537
|
|
|
$
|
28,747
|
|
|
19.1
|
%
|
|
|
|
|
|
|
Six months ended
June 30, 2018:
|
|
|
|
|
|
As
reported
|
$
|
510,428
|
|
|
$
|
100,463
|
|
|
19.7
|
%
|
Non-recurring, other
unusual and non-operating pension and OPEB
items
|
(155,054)
|
|
|
(16,016)
|
|
|
|
As
adjusted
|
$
|
355,374
|
|
|
$
|
84,447
|
|
|
23.8
|
%
|
|
|
|
|
|
|
Six months ended
June 30, 2017:
|
|
|
|
|
|
As
reported
|
$
|
175,228
|
|
|
$
|
35,101
|
|
|
20.0
|
%
|
Non-recurring, other
unusual and non-operating pension and OPEB
items
|
116,176
|
|
|
25,232
|
|
|
|
As
adjusted
|
$
|
291,404
|
|
|
$
|
60,333
|
|
|
20.7
|
%
|
View original content with
multimedia:http://www.prnewswire.com/news-releases/albemarle-reports-strong-growth-and-raises-guidance---lithium-powers-ahead-300693457.html
SOURCE Albemarle Corporation