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Albemarle's (ALB) Earnings Miss Estimates in Q2, Revenues Beat
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Albemarle Corporation (ALB - Free Report) logged a loss of $1.96 per share in the second quarter of 2024. In the year-ago quarter, the company had reported earnings of $5.52 per share.
Adjusted earnings in the reported quarter came in at 4 cents per share, missing the Zacks Consensus Estimate of 53 cents.
Revenues fell roughly 40% year over year to $1,430.4 million in the quarter. However, the metric beat the Zacks Consensus Estimate of $1,400.7 million. The top line was hurt by lower prices, partly offset by the volume growth in the Energy Storage unit. Lower lithium market pricing impacted the company's results in the quarter. ALB delivered more than $150 million in productivity benefits in the reported quarter and is on track to surpass its initial target by roughly 50%.
Albemarle Corporation Price, Consensus and EPS Surprise
Sales from the Energy Storage unit fell around 53% year over year to $830.1 million. It beat the consensus estimate of $822.6 million. The decline in sales was attributed to reduced pricing. However, sales volumes increased driven by the ramp-up of lithium projects, including the La Negra expansion in Chile and the processing plant in Qinzhou, China.
The Specialties segment recorded sales of $334.6 million, down around 10% year over year. It was above the consensus estimate of $309.9 million. Lower pricing impacted sales, partly offset by increased volumes.
The Ketjen unit recorded revenues of $265.7 million in the reported quarter, up roughly 13% year over year. It was above the consensus estimate of $259.6 million. Higher volumes aided sales, partly masked by lower pricing.
Financial Position
Albemarle ended the quarter with cash and cash equivalents of roughly $1,830.2 million, down around 11% sequentially. Long-term debt was around $3,519.5 million, flat sequentially.
Outlook
Albemarle has lowered its adjusted EBITDA outlook for the Specialties unit factoring in slower-than-expected market recovery and higher logistics costs related to the ongoing conflict in the Middle East. It now sees an adjusted EBITDA of $210-$260 million for the segment.
Capital expenditures for 2024 are forecast to be at the top end of the range of $1.7-$1.8 billion. Depreciation and amortization are projected to be in the band of $580-$630 million. Corporate costs are projected in the range of $60-$90 million while interest and financing expenses are expected to be between $140 million and $170 million.
Price Performance
Shares of Albemarle have lost 53.8% in the past year compared with a 9.1% fall of the industry.
Kronos is expected to report second-quarter results on Aug 7. The Zacks Consensus Estimate for KRO’s second-quarter earnings is pegged at 21 cents. The company’s shares have rallied roughly 29% in the past year.
Ashland is slated to report fiscal third-quarter results on Aug 6. The Zacks Consensus Estimate for ASH’s third-quarter earnings is pegged at $1.47. The company’s shares have gained roughly 7% in the past year.
Hecla is slated to report second-quarter results on Aug 6. The Zacks Consensus Estimate for Hecla's second-quarter earnings is pegged at a penny per share. The stock has gained nearly 9% in the past year.
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Albemarle's (ALB) Earnings Miss Estimates in Q2, Revenues Beat
Albemarle Corporation (ALB - Free Report) logged a loss of $1.96 per share in the second quarter of 2024. In the year-ago quarter, the company had reported earnings of $5.52 per share.
Adjusted earnings in the reported quarter came in at 4 cents per share, missing the Zacks Consensus Estimate of 53 cents.
Revenues fell roughly 40% year over year to $1,430.4 million in the quarter. However, the metric beat the Zacks Consensus Estimate of $1,400.7 million. The top line was hurt by lower prices, partly offset by the volume growth in the Energy Storage unit. Lower lithium market pricing impacted the company's results in the quarter. ALB delivered more than $150 million in productivity benefits in the reported quarter and is on track to surpass its initial target by roughly 50%.
Albemarle Corporation Price, Consensus and EPS Surprise
Albemarle Corporation price-consensus-eps-surprise-chart | Albemarle Corporation Quote
Segment Highlights
Sales from the Energy Storage unit fell around 53% year over year to $830.1 million. It beat the consensus estimate of $822.6 million. The decline in sales was attributed to reduced pricing. However, sales volumes increased driven by the ramp-up of lithium projects, including the La Negra expansion in Chile and the processing plant in Qinzhou, China.
The Specialties segment recorded sales of $334.6 million, down around 10% year over year. It was above the consensus estimate of $309.9 million. Lower pricing impacted sales, partly offset by increased volumes.
The Ketjen unit recorded revenues of $265.7 million in the reported quarter, up roughly 13% year over year. It was above the consensus estimate of $259.6 million. Higher volumes aided sales, partly masked by lower pricing.
Financial Position
Albemarle ended the quarter with cash and cash equivalents of roughly $1,830.2 million, down around 11% sequentially. Long-term debt was around $3,519.5 million, flat sequentially.
Outlook
Albemarle has lowered its adjusted EBITDA outlook for the Specialties unit factoring in slower-than-expected market recovery and higher logistics costs related to the ongoing conflict in the Middle East. It now sees an adjusted EBITDA of $210-$260 million for the segment.
Capital expenditures for 2024 are forecast to be at the top end of the range of $1.7-$1.8 billion. Depreciation and amortization are projected to be in the band of $580-$630 million. Corporate costs are projected in the range of $60-$90 million while interest and financing expenses are expected to be between $140 million and $170 million.
Price Performance
Shares of Albemarle have lost 53.8% in the past year compared with a 9.1% fall of the industry.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
ALB currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the Basic Materials space are Kronos Worldwide, Inc. (KRO - Free Report) , Ashland Inc. (ASH - Free Report) and Hecla Mining Company (HL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Kronos is expected to report second-quarter results on Aug 7. The Zacks Consensus Estimate for KRO’s second-quarter earnings is pegged at 21 cents. The company’s shares have rallied roughly 29% in the past year.
Ashland is slated to report fiscal third-quarter results on Aug 6. The Zacks Consensus Estimate for ASH’s third-quarter earnings is pegged at $1.47. The company’s shares have gained roughly 7% in the past year.
Hecla is slated to report second-quarter results on Aug 6. The Zacks Consensus Estimate for Hecla's second-quarter earnings is pegged at a penny per share. The stock has gained nearly 9% in the past year.