filings.toolsItem 1. Financial Statements (Unaudited).
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Item 1. Financial Statements (Unaudited).
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Amounts)
(Unaudited)
| Three Months Ended March 31, | ||||||||||||||||||||||||||
| 2025 | 2024 | |||||||||||||||||||||||||
| Net sales | $ | 1,076,881 | $ | 1,360,736 | ||||||||||||||||||||||
| Cost of goods sold(a) | 920,582 | 1,321,798 | ||||||||||||||||||||||||
| Gross profit | 156,299 | 38,938 | ||||||||||||||||||||||||
| Selling, general and administrative expenses | 123,502 | 161,376 | ||||||||||||||||||||||||
| Restructuring charges and asset write-offs | (1,063) | 33,536 | ||||||||||||||||||||||||
| Research and development expenses | 14,099 | 23,532 | ||||||||||||||||||||||||
| Operating profit (loss) | 19,761 | (179,506) | ||||||||||||||||||||||||
| Interest and financing expenses | (48,977) | (37,969) | ||||||||||||||||||||||||
| Other income, net | 10,250 | 49,901 | ||||||||||||||||||||||||
| Loss before income taxes and equity in net income of unconsolidated investments | (18,966) | (167,574) | ||||||||||||||||||||||||
| Income tax benefit | (3,978) | (3,721) | ||||||||||||||||||||||||
| Loss before equity in net income of unconsolidated investments | (14,988) | (163,853) | ||||||||||||||||||||||||
| Equity in net income of unconsolidated investments (net of tax) | 64,286 | 180,500 | ||||||||||||||||||||||||
| Net income | 49,298 | 16,647 | ||||||||||||||||||||||||
| Net income attributable to noncontrolling interests | (7,950) | (14,199) | ||||||||||||||||||||||||
| Net income attributable to Albemarle Corporation | 41,348 | 2,448 | ||||||||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (11,584) | ||||||||||||||||||||||||
| Net loss attributable to Albemarle Corporation common shareholders | $ | (340) | $ | (9,136) | ||||||||||||||||||||||
| Basic loss per share attributable to common shareholders | $ | (0.00) | $ | (0.08) | ||||||||||||||||||||||
| Diluted loss per share attributable to common shareholders | $ | (0.00) | $ | (0.08) | ||||||||||||||||||||||
| Weighted-average common shares outstanding – basic | 117,603 | 117,451 | ||||||||||||||||||||||||
| Weighted-average common shares outstanding – diluted | 117,603 | 117,451 |
(a)Included purchases from related unconsolidated affiliates of $119.8 million and $540.7 million for the three-month periods ended March 31, 2025 and 2024, respectively.
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In Thousands)
(Unaudited)
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Net income | $ | 49,298 | $ | 16,647 | |||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Foreign currency translation and other | 109,015 | (50,220) | |||||||||||||||||||||
| Cash flow hedge | (107) | (18,660) | |||||||||||||||||||||
| Total other comprehensive income (loss), net of tax | 108,908 | (68,880) | |||||||||||||||||||||
| Comprehensive income (loss) | 158,206 | (52,233) | |||||||||||||||||||||
| Comprehensive income attributable to noncontrolling interests | (7,932) | (13,998) | |||||||||||||||||||||
| Comprehensive income (loss) attributable to Albemarle Corporation | $ | 150,274 | $ | (66,231) |
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Per Share Amounts)
(Unaudited)
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 1,518,511 | $ | 1,192,230 | |||||||
| Trade accounts receivable, less allowance for credit losses (2025 – $5,198; 2024 – $5,201) | 670,775 | 742,201 | |||||||||
| Other accounts receivable | 137,080 | 238,384 | |||||||||
| Inventories | 1,656,365 | 1,502,531 | |||||||||
| Other current assets | 124,551 | 166,916 | |||||||||
| Total current assets | 4,107,282 | 3,842,262 | |||||||||
| Property, plant and equipment, at cost | 12,660,018 | 12,523,368 | |||||||||
| Less accumulated depreciation and amortization | 3,356,979 | 3,191,898 | |||||||||
| Net property, plant and equipment | 9,303,039 | 9,331,470 | |||||||||
| Investments | 1,124,777 | 1,117,739 | |||||||||
| Other assets | 628,277 | 504,711 | |||||||||
| Goodwill | 1,606,144 | 1,582,714 | |||||||||
| Other intangibles, net of amortization | 229,739 | 230,753 | |||||||||
| Total assets | $ | 16,999,258 | $ | 16,609,649 | |||||||
| Liabilities And Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable to third parties | $ | 778,658 | $ | 793,455 | |||||||
| Accounts payable to related parties | 139,296 | 150,432 | |||||||||
| Accrued expenses | 379,871 | 467,997 | |||||||||
| Current portion of long-term debt | 410,477 | 398,023 | |||||||||
| Dividends payable | 61,312 | 61,282 | |||||||||
| Income taxes payable | 174,779 | 95,275 | |||||||||
| Total current liabilities | 1,944,393 | 1,966,464 | |||||||||
| Long-term debt | 3,128,655 | 3,118,142 | |||||||||
| Postretirement benefits | 31,908 | 31,930 | |||||||||
| Pension benefits | 115,846 | 116,192 | |||||||||
| Other noncurrent liabilities | 1,125,943 | 819,204 | |||||||||
| Deferred income taxes | 378,171 | 358,029 | |||||||||
| Commitments and contingencies (Note 7) | |||||||||||
| Equity: | |||||||||||
| Albemarle Corporation shareholders’ equity: | |||||||||||
| Common stock, $.01 par value, authorized – 275,000, issued and outstanding – 117,651 in 2025 and 117,560 in 2024 | 1,177 | 1,176 | |||||||||
| Mandatory convertible preferred stock, Series A, no par value, $1,000 stated value, authorized – 15,000, issued and outstanding – 2,300 in 2025 and 2024 | 2,235,105 | 2,235,105 | |||||||||
| Additional paid-in capital | 2,991,389 | 2,985,606 | |||||||||
| Accumulated other comprehensive loss | (633,136) | (742,062) | |||||||||
| Retained earnings | 5,433,704 | 5,481,692 | |||||||||
| Total Albemarle Corporation shareholders’ equity | 10,028,239 | 9,961,517 | |||||||||
| Noncontrolling interests | 246,103 | 238,171 | |||||||||
| Total equity | 10,274,342 | 10,199,688 | |||||||||
| Total liabilities and equity | $ | 16,999,258 | $ | 16,609,649 |
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In Thousands, Except Per Share Amounts)
(Unaudited)
| (In Thousands, Except Share Data) | Mandatory Convertible Preferred Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Total Albemarle Shareholders’ Equity | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amounts | Shares | Amounts | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | 117,559,774 | $ | 1,176 | 2,300,000 | $ | 2,235,105 | $ | 2,985,606 | $ | (742,062) | $ | 5,481,692 | $ | 9,961,517 | $ | 238,171 | $ | 10,199,688 | |||||||||||||||||||||||||||||||||||||||||
| Net income | 41,348 | 41,348 | 7,950 | 49,298 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | 108,926 | 108,926 | (18) | 108,908 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock dividends declared, $0.405 per common share | (47,648) | (47,648) | — | (47,648) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Mandatory convertible preferred stock cumulative dividends | (41,688) | (41,688) | (41,688) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 7,502 | 7,502 | 7,502 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | 21,151 | — | 1,186 | 1,186 | 1,186 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net | 106,073 | 1 | (1) | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Withholding taxes paid on stock-based compensation award distributions | (36,430) | — | (2,904) | (2,904) | (2,904) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | 117,650,568 | $ | 1,177 | 2,300,000 | $ | 2,235,105 | $ | 2,991,389 | $ | (633,136) | $ | 5,433,704 | $ | 10,028,239 | $ | 246,103 | $ | 10,274,342 | |||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2023 | 117,356,270 | $ | 1,174 | — | $ | — | $ | 2,952,517 | $ | (528,526) | $ | 6,987,015 | $ | 9,412,180 | $ | 252,919 | $ | 9,665,099 | |||||||||||||||||||||||||||||||||||||||||
| Net income | 2,448 | 2,448 | 14,199 | 16,647 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | (68,679) | (68,679) | (201) | (68,880) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock dividends declared, $0.40 per common share | (47,011) | (47,011) | — | (47,011) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Mandatory convertible preferred stock cumulative dividends | (11,584) | (11,584) | (11,584) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 9,057 | 9,057 | 9,057 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | 1,420 | — | 86 | 86 | 86 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net | 260,750 | 2 | 11,543 | 11,545 | 11,545 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of mandatory convertible preferred stock, net | 2,300,000 | 2,235,379 | 2,235,379 | 2,235,379 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Withholding taxes paid on stock-based compensation award distributions | (91,273) | (1) | (10,618) | (10,619) | (10,619) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2024 | 117,527,167 | $ | 1,175 | 2,300,000 | $ | 2,235,379 | $ | 2,962,585 | $ | (597,205) | $ | 6,930,868 | $ | 11,532,802 | $ | 266,917 | $ | 11,799,719 |
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
| Three Months Ended March 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash and cash equivalents at beginning of year | $ | 1,192,230 | $ | 889,900 | |||||||
| Cash flows from operating activities: | |||||||||||
| Net income | 49,298 | 16,647 | |||||||||
| Adjustments to reconcile net income to cash flows from operating activities: | |||||||||||
| Depreciation and amortization | 161,754 | 123,751 | |||||||||
| Stock-based compensation and other | 6,966 | 9,317 | |||||||||
| Equity in net income of unconsolidated investments (net of tax) | (64,286) | (180,500) | |||||||||
| Dividends received from unconsolidated investments and nonmarketable securities | 60,335 | 50,756 | |||||||||
| Pension and postretirement expense | 1,696 | 1,273 | |||||||||
| Pension and postretirement contributions | (5,196) | (4,824) | |||||||||
| Realized loss on investments in marketable securities | — | 33,746 | |||||||||
| Unrealized loss on investments in marketable securities | 5,331 | 6,737 | |||||||||
| Deferred income taxes | (5,669) | 116,447 | |||||||||
| Working capital changes | (21,992) | (52,320) | |||||||||
| Noncurrent liability changes and other, net | 357,146 | (23,076) | |||||||||
| Net cash provided by operating activities | 545,383 | 97,954 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (182,624) | (579,322) | |||||||||
| Sales of marketable securities, net | 3,381 | 84,893 | |||||||||
| Investments in equity investments and nonmarketable securities | (60) | (74) | |||||||||
| Net cash used in investing activities | (179,303) | (494,503) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of mandatory convertible preferred stock, net of issuance costs | — | 2,236,750 | |||||||||
| Repayments of long-term debt and credit agreements | (9,615) | (29,019) | |||||||||
| Proceeds from borrowings of long-term debt and credit agreements | — | 29,019 | |||||||||
| Other debt repayments, net | (1,195) | (620,753) | |||||||||
| Dividends paid to common shareholders | (47,607) | (46,908) | |||||||||
| Dividends paid to mandatory convertible preferred shareholders | (41,688) | — | |||||||||
| Dividends paid to noncontrolling interests | (18,169) | — | |||||||||
| Proceeds from exercise of stock options | 1,186 | 86 | |||||||||
| Withholding taxes paid on stock-based compensation award distributions | (2,904) | (10,619) | |||||||||
| Other | (14) | (1,256) | |||||||||
| Net cash (used in) provided by financing activities | (120,006) | 1,557,300 | |||||||||
| Net effect of foreign exchange on cash and cash equivalents | 80,207 | 5,162 | |||||||||
| Increase in cash and cash equivalents | 326,281 | 1,165,913 | |||||||||
| Cash and cash equivalents at end of period | $ | 1,518,511 | $ | 2,055,813 |
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 1—Basis of Presentation:
In the opinion of management, the accompanying unaudited condensed consolidated financial statements of Albemarle Corporation and our wholly-owned, majority-owned and controlled subsidiaries (collectively, “Albemarle,” “we,” “us,” “our” or the “Company”) contain all adjustments necessary for a fair statement, in all material respects, of our consolidated balance sheets as of March 31, 2025 and December 31, 2024, our consolidated statements of income, consolidated statements of comprehensive income (loss) and consolidated statements of changes in equity for the three-month periods ended March 31, 2025 and 2024 and our condensed consolidated statements of cash flows for the three-month periods ended March 31, 2025 and 2024. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 12, 2025. The December 31, 2024 consolidated balance sheet data herein was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles (“GAAP”) in the United States (“U.S.”). The results of operations for the three-month periods ended March 31, 2025 are not necessarily indicative of the results to be expected for the full year.
NOTE 2—Inventories:
The following table provides a breakdown of inventories at March 31, 2025 and December 31, 2024 (in thousands):
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| Finished goods | $ | 1,040,218 | $ | 912,662 | |||||||
| Raw materials and work in process(a) | 451,006 | 429,080 | |||||||||
| Stores, supplies and other | 165,141 | 160,789 | |||||||||
| Total(b) | $ | 1,656,365 | $ | 1,502,531 |
(a)Includes $306.1 million and $290.6 million at March 31, 2025 and December 31, 2024, respectively, of work in process in our Energy Storage segment.
(b)As a result of the decline in lithium market pricing, the Company recorded charges in Cost of goods sold to reduce the value of certain finished goods and spodumene to their net realizable value. The balance of these inventory valuation adjustments totaled $6.6 million and $104.0 million at March 31, 2025 and December 31, 2024, respectively. During the three-month periods ended March 31, 2025 and 2024, the Company utilized $97.3 million and $194.2 million, respectively, of the inventory valuation adjustments as the inventory was sold, which are included within Working capital changes on the condensed consolidated statement of cash flows.
The Company purchases certain of its inventory from its equity method investments (primarily the Windfield Holdings Pty. Ltd. (“Windfield”) joint venture) and eliminates the balance of intra-entity profits on purchases of such inventory that remains unsold at the balance sheet date in Inventories, specifically finished goods and equally reduces Equity in net income of unconsolidated investments (net of tax) on the consolidated statements of income. The balance of intra-entity profits on inventory purchased from equity method investments in Inventories totaled $68.1 million and $66.8 million at March 31, 2025 and December 31, 2024, respectively. The intra-entity profit is recognized in Equity in net income of unconsolidated investments (net of tax) in the period that converted inventory is sold to a third-party customer. In the same period, the intra-entity profit is also recognized as higher Cost of goods sold on the consolidated statements of income.
NOTE 3—Investments:
Unconsolidated Joint Ventures
The following table details the Company’s equity in net income of unconsolidated investments (net of tax) for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Windfield | $ | 54,986 | $ | 172,679 | |||||||||||||||||||
| Other joint ventures | 9,300 | 7,821 | |||||||||||||||||||||
| Total | $ | 64,286 | $ | 180,500 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
The Company holds a 49% equity interest in Windfield, where the ownership parties share risks and benefits disproportionate to their voting interests. As a result, the Company considers Windfield to be a variable interest entity (“VIE”), however this investment is not consolidated as the Company is not the primary beneficiary. The carrying amount of the Company’s 49% equity interest in Windfield, which is the Company’s most significant VIE, was $583.6 million at March 31, 2025 and December 31, 2024. The Company’s unconsolidated VIEs are reported in Investments on the consolidated balance sheets. The Company does not guarantee debt for, or have other financial support obligations to, these entities, and its maximum exposure to loss in connection with its continuing involvement with these entities is limited to the carrying value of the investments.
The following table summarizes the unaudited results of operations for the Windfield joint venture, which met the significant subsidiary test for subsidiaries not consolidated or 50% or less owned persons under Rule 10-01 of Regulation S-X, for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Net sales | $ | 290,419 | $ | 190,009 | |||||||||||||||||||
| Gross profit | 192,704 | 149,982 | |||||||||||||||||||||
| Income before income taxes | 144,796 | 94,630 | |||||||||||||||||||||
| Net income | 101,744 | 66,411 |
Public Equity Securities
Included in the Company’s investments balance are holdings in equity securities of public companies. The fair value is measured using publicly available share prices of the investments, with any changes reported in Other income, net in our consolidated statements of income. During the three-month periods ended March 31, 2025 and 2024, the Company recorded unrealized mark-to-market losses of $5.0 million and $9.4 million, respectively, in Other income, net for all public equity securities held at the end of the balance sheet date.
In January 2024, the Company sold equity securities of a public company for proceeds of approximately $81.5 million. As a result of the sale, the Company realized a loss of $33.7 million in Other income, net during the three-month period ended March 31, 2024.
Other
As part of the proceeds from the sale of the fine chemistry services (“FCS”) business on June 1, 2021, W.R. Grace & Co. (“Grace”) issued Albemarle preferred equity of a Grace subsidiary having an aggregate stated value of $270 million. The preferred equity can be redeemed at Grace’s option under certain conditions and began accruing payment-in-kind (“PIK”) dividends at an annual rate of 12% on June 1, 2023. In addition, the preferred equity can be redeemed by Albemarle when the accumulated balance reaches 200% of the original value. This preferred equity had a fair value of $320.4 million and $314.0 million at March 31, 2025 and December 31, 2024, respectively, which is reported in Investments in the consolidated balance sheets.
NOTE 4—Goodwill and Other Intangibles:
The following table summarizes the changes in goodwill by reportable segment for the three-month period ended March 31, 2025 (in thousands):
| Energy Storage | Specialties | Ketjen | Total | ||||||||||||||||||||||||||
| Balance at December 31, 2024(a) | $ | 1,387,591 | $ | 32,577 | $ | 162,546 | $ | 1,582,714 | |||||||||||||||||||||
| Foreign currency translation adjustments | 18,372 | 10 | 5,048 | 23,430 | |||||||||||||||||||||||||
| Balance at March 31, 2025(a) | $ | 1,405,963 | $ | 32,587 | $ | 167,594 | $ | 1,606,144 |
(a) Balance at March 31, 2025 and December 31, 2024 includes an accumulated impairment loss of $6.8 million from the (“PCS”) reporting unit within the Ketjen segment. As a result, the balance of Ketjen at March 31, 2025 and December 31, 2024 fully consists of goodwill related to the Refining Solutions reporting unit.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
As previously discussed in Part II, Item 8 - Note 1, "Summary of Significant Accounting Policies," of the Company's Annual Report on Form 10-K for the year ended December 31, 2024, if revenue or adjusted EBITDA growth are lower than forecasted, or costs are higher than anticipated, the Company may recognize a non-cash goodwill impairment loss in the Refining Solutions reporting unit within the Ketjen segment.
The following table summarizes the changes in other intangibles and related accumulated amortization for the three-month period ended March 31, 2025 (in thousands):
| Customer Lists and Relationships | Trade Names and Trademarks**(a)** | Patents and Technology | Other | Total | |||||||||||||||||||||||||
| Gross Asset Value | |||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | 402,012 | $ | 10,670 | $ | 32,265 | $ | 29,010 | $ | 473,957 | |||||||||||||||||||
| Foreign currency translation adjustments and other | 7,197 | 214 | 147 | 937 | 8,495 | ||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | 409,209 | $ | 10,884 | $ | 32,412 | $ | 29,947 | $ | 482,452 | |||||||||||||||||||
| Accumulated Amortization | |||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | (216,231) | $ | (1,324) | $ | (14,253) | $ | (11,396) | $ | (243,204) | |||||||||||||||||||
| Amortization | (4,615) | — | (629) | (223) | (5,467) | ||||||||||||||||||||||||
| Foreign currency translation adjustments and other | (3,761) | — | (89) | (192) | (4,042) | ||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | (224,607) | $ | (1,324) | $ | (14,971) | $ | (11,811) | $ | (252,713) | |||||||||||||||||||
| Net Book Value at December 31, 2024 | $ | 185,781 | $ | 9,346 | $ | 18,012 | $ | 17,614 | $ | 230,753 | |||||||||||||||||||
| Net Book Value at March 31, 2025 | $ | 184,602 | $ | 9,560 | $ | 17,441 | $ | 18,136 | $ | 229,739 |
(a) Net Book Value includes only indefinite-lived intangible assets.
NOTE 5—Long-Term Debt:
Long-term debt at March 31, 2025 and December 31, 2024 consisted of the following (in thousands):
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| 1.125% notes due 2025 | $ | 405,565 | $ | 393,346 | |||||||
| 1.625% notes due 2028 | 537,700 | 521,500 | |||||||||
| 3.45% Senior notes due 2029 | 171,612 | 171,612 | |||||||||
| 4.65% Senior notes due 2027 | 650,000 | 650,000 | |||||||||
| 5.05% Senior notes due 2032 | 600,000 | 600,000 | |||||||||
| 5.45% Senior notes due 2044 | 350,000 | 350,000 | |||||||||
| 5.65% Senior notes due 2052 | 450,000 | 450,000 | |||||||||
| Interest-free loan | 300,000 | 300,000 | |||||||||
| Variable-rate foreign bank loans | 18,592 | 27,477 | |||||||||
| Finance lease obligations | 117,872 | 118,796 | |||||||||
| Other | 22,000 | 22,000 | |||||||||
| Unamortized discount and debt issuance costs | (84,209) | (88,566) | |||||||||
| Total long-term debt | 3,539,132 | 3,516,165 | |||||||||
| Less amounts due within one year | 410,477 | 398,023 | |||||||||
| Long-term debt, less current portion | $ | 3,128,655 | $ | 3,118,142 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 6—Other Noncurrent Liabilities:
Other noncurrent liabilities consist of the following at March 31, 2025 and December 31, 2024 (in thousands):
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| Transition tax on foreign earnings(a) | $ | 44,647 | $ | 44,647 | |||||||
| Operating leases(b) | 101,349 | 99,514 | |||||||||
| Liabilities related to uncertain tax positions | 242,611 | 259,586 | |||||||||
| Executive deferred compensation plan obligation | 34,552 | 38,243 | |||||||||
| Environmental liabilities(c) | 15,926 | 15,783 | |||||||||
| Asset retirement obligations | 96,724 | 94,854 | |||||||||
| Tax indemnification liability(d) | 11,044 | 12,567 | |||||||||
| Deferred revenue | 406,152 | 78,027 | |||||||||
| Capital expenditure incentive payables(e) | 74,506 | 74,506 | |||||||||
| Other(f) | 98,432 | 101,477 | |||||||||
| Total | $ | 1,125,943 | $ | 819,204 |
(a)Noncurrent portion of one-time transition tax on foreign earnings.
(b)See Note 13, “Leases.”
(c)See Note 7, “Commitments and Contingencies.”
(d)Indemnification of certain income and non-income tax liabilities, primarily associated with the Chemetall Surface Treatment entities sold in 2017.
(e)When constructing new facilities or making major enhancements to existing facilities, we may have the opportunity to enter into incentive agreements with local government agencies in order to reduce certain state and local tax expenditures. Under these agreements, we transfer the related assets to various local government entities and receive bonds. We immediately lease the facilities from the local government entities and have an option to repurchase the facilities for a nominal amount upon tendering the bonds to the local government entities at various predetermined dates. The bonds and the associated obligations for the leases of the facilities offset values, and the underlying assets are recorded in property, plant and equipment.
(f)No individual component exceeds 5% of total liabilities.
In the normal course of business, amounts received from customers in advance of the Company’s satisfaction of its contractual performance obligations are recorded as deferred revenue, and are recognized within Net sales as the Company satisfies the related performance obligation. During the three-month period ended March 31, 2025, the Company received $350 million from a customer for the delivery of specified amounts of spodumene and lithium salts over the next 5 years. $21.9 million of deferred revenue is expected to be recognized within Net sales over the next twelve months and is reported in Accrued expenses on the consolidated balance sheet. There was no deferred revenue recognized in Net sales during the three-month period ended March 31, 2025.
NOTE 7—Commitments and Contingencies:
Environmental
The following activity was recorded in environmental liabilities for the three months ended March 31, 2025 (in thousands):
| Beginning balance at December 31, 2024 | $ | 20,023 | |||
| Expenditures | (209) | ||||
| Accretion of discount | 213 | ||||
| Foreign currency translation adjustments and other | 92 | ||||
| Ending balance at March 31, 2025 | 20,119 | ||||
| Less amounts reported in Accrued expenses | 4,193 | ||||
| Amounts reported in Other noncurrent liabilities | $ | 15,926 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Environmental remediation liabilities included discounted liabilities of $16.8 million at March 31, 2025 and December 31, 2024, discounted at rates with a weighted-average of 4.0%, and with the undiscounted amount totaling $34.4 million and $34.5 million at March 31, 2025 and December 31, 2024, respectively.
The amounts recorded represent our future remediation and other anticipated environmental liabilities. These liabilities typically arise during the normal course of our operational and environmental management activities or at the time of acquisition of the site, and are based on internal analysis as well as input from outside consultants. As evaluations proceed at each relevant site, changes in risk assessment practices, remediation techniques and regulatory requirements can occur, therefore such liability estimates may be adjusted accordingly. The timing and duration of remediation activities at these sites will be determined when evaluations are completed. Although it is difficult to quantify the potential financial impact of these remediation liabilities, management estimates (based on the latest available information) that there is a reasonable possibility that future environmental remediation costs associated with our past operations could represent an additional $40 million before income taxes, in excess of amounts already recorded.
We believe that any sum we may be required to pay in connection with environmental remediation matters in excess of the amounts recorded would likely occur over a period of time and would likely not have a material adverse effect upon our results of operations, financial condition or cash flows on a consolidated annual basis although any such sum could have a material adverse impact on our results of operations, financial condition or cash flows in a particular quarterly reporting period.
Litigation
We are involved from time to time in legal proceedings of types regarded as common in our business, including administrative or judicial proceedings seeking remediation under environmental laws, such as the federal Comprehensive Environmental Response, Compensation and Liability Act, commonly known as CERCLA or Superfund, products liability, breach of contract liability and premises liability litigation. Where appropriate, we may establish financial reserves for such proceedings. We also maintain insurance to mitigate certain of such risks. Costs for legal services are generally expensed as incurred.
In April 2025, the Company concluded its non-prosecution agreement with the U.S. Department of Justice (“DOJ”) prior to the end of its term in recognition that the terms of the agreement had been satisfied. The non-prosecution agreement was implemented in September 2023 following the Company’s self-reporting of a matter that occurred in 2018.
Indemnities
We are indemnified by third parties in connection with certain matters related to acquired and divested businesses. Although we believe that the financial condition of those parties who may have indemnification obligations to the Company is generally sound, in the event the Company seeks indemnity under any of these agreements or through other means, there can be no assurance that any party who may have obligations to indemnify us will adhere to their obligations and we may have to resort to legal action to enforce our rights under the indemnities.
The Company may be subject to indemnity claims relating to properties or businesses it divested, including properties or businesses of acquired businesses that were divested prior to the completion of the acquisition. In the opinion of management, and based upon information currently available, the ultimate resolution of any indemnification obligations owed to the Company or by the Company is not expected to have a material effect on the Company’s financial condition, results of operations or cash flows. The Company had approximately $11.0 million and $12.6 million at March 31, 2025 and December 31, 2024, respectively, recorded in Other noncurrent liabilities, primarily related to the indemnification of certain income and non-income tax liabilities associated with the Chemetall Surface Treatment entities sold in 2017.
Other
The Company has contracts with certain of its customers which serve as guarantees of product delivery and performance according to customer specifications that can cover both shipments on an individual basis, as well as blanket coverage of multiple shipments under certain customer supply contracts. The financial coverage provided by these guarantees is typically based on a percentage of net sales value. The Company is unable to estimate the maximum amount of the potential future liability under performance guarantees. However, the Company accrues for any potential loss for which we believe a future payment is probable and a range of loss can be reasonably estimated. At March 31, 2025, the Company believes its liability under such obligations is immaterial.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 8—Equity:
Common Stock
On February 27, 2025, the Company’s board of directors declared a cash dividend of $0.405 per share. This dividend was paid on April 1, 2025 to shareholders of record at the close of business as of March 14, 2025.
Mandatory Convertible Preferred Stock
On March 8, 2024, the Company issued 46,000,000 depositary shares (“Depositary Shares”), each representing a 1/20th interest in a share of Series A Mandatory Convertible Preferred Stock (“Mandatory Convertible Preferred Stock”). The 2,300,000 shares of Mandatory Convertible Preferred Stock issued had a $1,000 per share liquidation preference. As a result of this transaction, the Company received cash proceeds of approximately $2.2 billion, net of underwriting fees and offering costs.
Dividends on the Mandatory Convertible Preferred Stock are payable on a cumulative basis when, as and if declared by the Albemarle board of directors, or an authorized committee thereof, at an annual rate of 7.25% on the liquidation preference of $1,000 per share, and may be paid in cash or, subject to certain limitations, in shares of common stock or, subject to certain limitations, any combination of cash and shares of common stock. Dividends that are declared on the Mandatory Convertible Preferred Stock will be payable quarterly to the holders of record on the February 15, May 15, August 15 and November 15 of each year, immediately preceding the relevant dividend payment date, whether or not such holders convert their Depositary Shares, or such Depositary Shares are automatically converted, after a record date and on or prior to the immediately succeeding dividend payment date. The Company paid cash dividends in March 2025, and are expected to pay subsequent cash dividends, of $18.125 per share of Mandatory Convertible Preferred Stock. Dividends are expected to be paid on March 1, June 1, September 1 and December 1 of each year ending on, and including, March 1, 2027.
The Company may not redeem the shares of the Mandatory Convertible Preferred Stock. However, at its option, the Company may purchase the Mandatory Convertible Preferred Stock from time to time on the open market, by tender offer, exchange offer or otherwise.
Unless converted earlier in accordance with its terms, each share of Mandatory Convertible Preferred Stock will automatically convert on the mandatory conversion date, which is expected to be March 1, 2027, into between 7.618 shares and 9.140 shares of common stock, in each case, subject to customary anti-dilution adjustments described in the certificate of designations related to the Mandatory Convertible Preferred Stock (the “Certificate of Designations”). The number of shares of common stock issuable upon conversion will be determined based on the average volume weighted average price per share of common stock over the 20 consecutive trading day period beginning on, and including, the 21st scheduled trading day immediately prior to March 1, 2027.
Holders of shares of Mandatory Convertible Preferred Stock have the option to convert all or any portion of their shares of the Mandatory Convertible Preferred Stock at any time. The conversion rate applicable to any early conversion may in certain circumstances be increased to compensate holders of the Mandatory Convertible Preferred Stock for certain unpaid accumulated dividends as described in the Certificate of Designations.
If a Fundamental Change, as defined in the Certificate of Designations, occurs on or prior to March 1, 2027, then holders of the Mandatory Convertible Preferred Stock will be entitled to convert all or any portion of their Mandatory Convertible Preferred Stock at the fundamental change conversion rate, as defined in the Certificate of Designations, as for a specified period of time and to also receive an amount to compensate them for certain unpaid accumulated dividends and any remaining future scheduled dividend payments.
There were 2,300,000 shares of Mandatory Convertible Preferred Stock issued and outstanding at March 31, 2025.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Accumulated Other Comprehensive Loss
The components and activity in Accumulated other comprehensive loss (net of deferred income taxes) consisted of the following during the periods indicated below (in thousands):
| Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign Currency Translation and Other | Cash Flow Hedge**(a)** | Total | Foreign Currency Translation and Other | Cash Flow Hedge**(a)** | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, beginning of period | $ | (747,202) | $ | 5,140 | $ | (742,062) | $ | (536,601) | $ | 8,075 | $ | (528,526) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) before reclassifications | 108,999 | (231) | 108,768 | (50,237) | (21,342) | (71,579) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss | 16 | 124 | 140 | 17 | 2,682 | 2,699 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | 109,015 | (107) | 108,908 | (50,220) | (18,660) | (68,880) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss attributable to noncontrolling interests | 18 | — | 18 | 201 | — | 201 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, end of period | $ | (638,169) | $ | 5,033 | $ | (633,136) | $ | (586,620) | $ | (10,585) | $ | (597,205) |
(a)We previously entered into a foreign currency forward contract, which was designated and accounted for as a cash flow hedge under ASC 815, Derivatives and Hedging. During 2024, the Company dedesignated the remaining foreign currency forward contracts accounted for as cash flow hedges. The related loss was reclassified to Other income, net during the three-month period ended March 31, 2024. The balance of the settled hedged foreign currency forward contracts will be reclassified to earnings over the life of the related assets. See Note 9, “Restructuring Charges and Asset Write-offs,” and Note 14, “Fair Value of Financial Instruments,” for additional information.
The amount of income tax (expense) benefit allocated to each component of Other comprehensive income (loss) for the three-month periods ended March 31, 2025 and 2024 is provided in the following tables (in thousands):
| Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign Currency Translation and Other | Cash Flow Hedge | Total | Foreign Currency Translation and Other | Cash Flow Hedge | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), before tax | $ | 109,018 | $ | (107) | $ | 108,911 | $ | (50,217) | $ | (26,657) | $ | (76,874) | |||||||||||||||||||||||||||||||||||||||||
| Income tax (expense) benefit | (3) | — | (3) | (3) | 7,997 | 7,994 | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | $ | 109,015 | $ | (107) | $ | 108,908 | $ | (50,220) | $ | (18,660) | $ | (68,880) |
NOTE 9—Restructuring Charges and Asset Write-offs:
Second Half 2024 Restructuring
In July 2024, the Company announced a comprehensive review of its cost and operating structure to proactively respond to ongoing industry headwinds, particularly in the lithium value chain, and to maintain a competitive position. As part of this review, the Company made the decision to stop construction of Kemerton Train 3 in Western Australia, and put Kemerton Train 2 into care and maintenance, as the Company determined the current lithium price environment makes it less economical to expand conversion in Australia. Kemerton Train 1 will continue to operate and activity around it is currently focused on commercialization efforts. Subsequently, in early 2025, the Company announced its additional decision to put the Chengdu, China conversion plant into care and maintenance by mid-year 2025. Production from the Chengdu site will be transferred to another processing facility in China.
The Company’s actions regarding Kemerton are part of a broader effort focused on preserving its world-class resource advantages, optimizing its global conversion network, improving the Company’s cost competitiveness and efficiency by
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
lowering operating costs, reducing capital intensity and enhancing the Company’s financial flexibility. As part of this effort, effective November 1, 2024, the Company transitioned its operating structure to a fully integrated functional model (excluding Ketjen) from a global business unit model. As a result, the Company implemented a global workforce reduction that impacted 6-7% of total headcount during the second half of 2024.
Since inception the Company has recorded charges for this plan consisting of asset write-offs of $725.7 million, severance and employee benefits of $52.9 million, contract cancellation costs of $35.5 million and other (primarily consisting of the reclassification of the related dedesignated cash flow hedge from Accumulated other comprehensive loss) of $36.2 million. Charges related to Second Half 2024 Restructuring were primarily recorded in the Energy Storage segment, with the exception of severance and employee benefits, which were recorded globally in Corporate and all segments. The Company expects to record additional decommissioning costs related to the Second Half 2024 Restructuring in the range of $20 million to $25 million for the remainder of 2025, after which the Company expects the actions to be substantially completed.
First Half 2024 Restructuring
In January 2024, the Company announced measures to unlock near-term cash flow and generate long-term financial flexibility by re-phasing organic growth investments and optimizing its cost structure. As part of these measures, during the second quarter of 2024, the Company indefinitely suspended construction of Kemerton Train 4, as well as deferred spending and investments with respect to certain other capital projects, primarily within the Energy Storage segment. In addition, the Company recorded severance costs for employees in Corporate and each of the businesses as part of these announced measures. As a result, since inception the Company has recorded charges for this plan consisting of asset write-offs of $280.6 million, severance and employee benefits of $18.9 million, contract cancellation costs of $24.9 million and other (primarily consisting of the reclassification of the related dedesignated cash flow hedge from Accumulated other comprehensive loss) of $5.4 million. No further costs associated with the First Half 2024 Restructuring are expected to be recorded as this restructuring plan was completed in the first half of 2024.
Detail of Restructuring Charges and Reserves
The following table provides details of our restructuring related charges for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||
| Asset Write-offs**(a)** | Severance and Employee Benefits**(b)** | Contract Cancellation Costs**(c)** | Other**(d)** | Total | |||||||||||||||||||||||||
| Second Half 2024 Restructuring(e) | (7,248) | 1,620 | (1,826) | 6,621 | (833) | ||||||||||||||||||||||||
| Three Months Ended March 31, 2024 | |||||||||||||||||||||||||||||
| Asset Write-offs**(a)** | Severance and Employee Benefits**(b)** | Contract Cancellation Costs**(c)** | Other**(d)** | Total | |||||||||||||||||||||||||
| First Half 2024 Restructuring(e) | $ | — | $ | 16,336 | $ | 17,200 | $ | 2,749 | $ | 36,285 | |||||||||||||||||||
(a) In the first quarter of 2025, the Company received proceeds for certain Kemerton equipment and updated its estimates concerning the progress of construction activities and related contractual obligations, resulting in a favorable adjustment of asset write-offs. This favorable adjustment to asset write-off charges was recorded in Restructuring charges and asset write-offs.
(b) Severance and employee benefit charges for global employees terminated during the various restructuring programs were recorded in Restructuring charges and asset write-offs.
(c) Includes cancellation fees for contractors and required payments under take or pay contracts. In the first quarter of 2025, the Company successfully negotiated revised contract cancellation costs with key suppliers to result in a favorable adjustment. All contract cancellation costs and favorable adjustments were recorded in Restructuring charges and asset write-offs.
(d) Other includes costs to put Kemerton Train 2 and the Chengdu, China conversion plant into care and maintenance and similar restructuring costs, and are recorded in Restructuring charges and asset write-offs. In addition, Other also includes the reclassification of the related dedesignated cash flow hedge from Accumulated other comprehensive loss. $0.2 million recorded in Other income, net for the three-month period ended March 31, 2025 related to the Second Half 2024 Restructuring and $2.7 million recorded in Other income, net for the three-month period ended March 31, 2024 related to the First Half 2024 Restructuring.
(e) Severance and employee benefits related to Corporate and all segments. All other restructuring costs were primarily recorded in the Energy Storage segment.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
The following tables summarize the changes in restructuring liabilities for the three-month period ended March 31, 2025 (in thousands):
| Second Half 2024 Restructuring | Asset Write-offs | Severance and Employee Benefits | Contract Cancellation Costs | Other | Total | ||||||||||||||||||||||||
| Beginning balance at December 31, 2024 | $ | — | $ | 15,867 | $ | 32,479 | $ | 8,811 | $ | 57,157 | |||||||||||||||||||
| 2025 charges | 2,142 | 5,398 | — | 6,621 | 14,161 | ||||||||||||||||||||||||
| Change in estimate(a) | (9,390) | (3,778) | (1,826) | — | (14,994) | ||||||||||||||||||||||||
| Cash payments | — | (6,758) | (5,090) | (3,520) | (15,368) | ||||||||||||||||||||||||
| Asset write-off/hedge dedesignation | 7,248 | — | — | (6,621) | 627 | ||||||||||||||||||||||||
| Foreign currency translation adjustments | — | 103 | — | — | 103 | ||||||||||||||||||||||||
| Ending balance at March 31, 2025(b) | $ | — | $ | 10,832 | $ | 25,563 | $ | 5,291 | $ | 41,686 | |||||||||||||||||||
| First Half 2024 Restructuring | Asset Write-offs | Severance and Employee Benefits | Contract Cancellation Costs | Other | Total | ||||||||||||||||||||||||
| Beginning balance at December 31, 2024 | $ | — | $ | — | $ | 2,767 | $ | — | $ | 2,767 | |||||||||||||||||||
| Cash payments | — | — | (1,738) | — | (1,738) | ||||||||||||||||||||||||
| Ending balance at March 31, 2025(b) | $ | — | $ | — | $ | 1,029 | $ | — | $ | 1,029 |
(a) In the first quarter of 2025, the Company received proceeds for certain Kemerton equipment and updated its estimates concerning the progress of construction activities and related contractual obligation, as well as updated estimates of severance charges in the U.S., resulting in a favorable adjustment of asset write-offs and severance and employee benefits. Additionally, the Company successfully negotiated revised contract cancellation costs with key suppliers to result in a favorable adjustment of the restructuring related charges.
(b) Approximately $30.3 million of the remaining balance is expected to be paid in the next twelve months and are recorded in Accrued expenses as of March 31, 2025. $12.4 million of the liability is recorded in Other noncurrent liabilities as of March 31, 2025, and relates to certain take or pay liabilities that will be paid in line with the terms of the original contract through 2027.
NOTE 10—Pension Plans and Other Postretirement Benefits:
The components of pension and postretirement benefits cost (credit) for the three-month periods ended March 31, 2025 and 2024 were as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Pension Benefits Cost (Credit): | |||||||||||||||||||||||
| Service cost | $ | 1,397 | $ | 1,566 | |||||||||||||||||||
| Interest cost | 8,339 | 8,145 | |||||||||||||||||||||
| Expected return on assets | (8,535) | (8,830) | |||||||||||||||||||||
| Amortization of prior service benefit | 19 | 20 | |||||||||||||||||||||
| Total net pension benefits cost | $ | 1,220 | $ | 901 | |||||||||||||||||||
| Postretirement Benefits Cost: | |||||||||||||||||||||||
| Service cost | $ | 5 | $ | 12 | |||||||||||||||||||
| Interest cost | 471 | 360 | |||||||||||||||||||||
| Total net postretirement benefits cost | $ | 476 | $ | 372 | |||||||||||||||||||
| Total net pension and postretirement benefits cost | $ | 1,696 | $ | 1,273 |
All components of net benefit cost, other than service cost, are included in Other income, net on the consolidated statements of income.
During the three-month periods ended March 31, 2025 and 2024, the Company made contributions of $5.2 million and $4.8 million, respectively, to its qualified and nonqualified pension plans and the U.S. postretirement benefit plan.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 11—Income Taxes:
The effective income tax rates for the three-month period ended March 31, 2025 was 21.0% compared to 2.2% for the three-month period ended March 31, 2024. The Company’s effective income tax rate fluctuates based on, among other factors, the amount and location of income. The increased effective tax rate in the three-month period ended March 31, 2025, compared to the three-month periods ended March 31, 2024, was due to higher 2025 earnings in various jurisdictions. The Company’s effective income tax rate for the three-month periods ended March 31, 2025 was in line with the U.S. federal statutory income tax rate of 21% due to the net impact of the location in which income was earned, including the impact of valuation allowances for losses in the Company’s consolidated Australian entities and certain entities in China, and an uncertain tax position recorded in Chile. The difference between the U.S. federal statutory income tax rate of 21% and the Company’s effective income tax rate for the three-month period ended March 31, 2024 was impacted by a variety of factors, primarily the location in which income was earned, including the valuation allowance for losses in certain entities in China, the global intangible low-taxed income inclusion, and a reduction to an uncertain tax position recorded in Chile.
NOTE 12—Earnings Per Share:
Basic and diluted loss per share for the three-month periods ended March 31, 2025 and 2024 are calculated as follows (in thousands, except per share amounts):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Basic loss per share | |||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 41,348 | $ | 2,448 | |||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (11,584) | |||||||||||||||||||||
| Net loss attributable to Albemarle Corporation common shareholders | $ | (340) | $ | (9,136) | |||||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted-average common shares for basic loss per share | 117,603 | 117,451 | |||||||||||||||||||||
| Basic loss per share | $ | (0.00) | $ | (0.08) | |||||||||||||||||||
| Diluted loss per share | |||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 41,348 | $ | 2,448 | |||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (11,584) | |||||||||||||||||||||
| Net loss attributable to Albemarle Corporation common shareholders | $ | (340) | $ | (9,136) | |||||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted-average common shares for diluted loss per share | 117,603 | 117,451 | |||||||||||||||||||||
| Diluted loss per share | $ | (0.00) | $ | (0.08) |
The following table summarizes the number of shares, calculated on a weighted average basis, not included in the computation of diluted earnings per share because their effect would have been anti-dilutive (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Shares assuming the conversion of the mandatory convertible preferred stock | 21,022 | 6,271 | |||||||||||||||||||||
| Shares under the stock compensation plans | 1,161 | 896 |
NOTE 13—Leases:
We lease certain office space, buildings, transportation and equipment in various countries. The initial lease terms generally range from 1 to 30 years for real estate leases, and from 2 to 15 years for non-real estate leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet, and we recognize lease expense for these leases on a straight-line basis over the lease term.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Many leases include options to terminate or renew, with renewal terms that can extend the lease term from 1 to 50 years or more. The exercise of lease renewal options is at our sole discretion. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The following table provides details of our lease contracts for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Operating lease cost | $ | 8,732 | $ | 9,546 | |||||||||||||||||||
| Finance lease cost: | |||||||||||||||||||||||
| Amortization of right of use assets | 1,998 | 1,308 | |||||||||||||||||||||
| Interest on lease liabilities | 1,619 | 1,459 | |||||||||||||||||||||
| Total finance lease cost | 3,617 | 2,767 | |||||||||||||||||||||
| Short-term lease cost | 6,166 | 6,018 | |||||||||||||||||||||
| Variable lease cost | 8,416 | 7,797 | |||||||||||||||||||||
| Total lease cost | $ | 26,931 | $ | 26,128 |
Supplemental cash flow information related to our lease contracts for the three-month periods ended March 31, 2025 and 2024 is as follows (in thousands):
| Three Months Ended March 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
| Operating cash flows from operating leases | $ | 8,386 | $ | 8,848 | |||||||
| Operating cash flows from finance leases | 1,615 | 1,018 | |||||||||
| Financing cash flows from finance leases | 1,195 | 560 | |||||||||
| Right-of-use assets obtained in exchange for lease obligations: | |||||||||||
| Operating leases | 9,896 | 8,856 | |||||||||
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Supplemental balance sheet information related to our lease contracts, including the location on balance sheet, at March 31, 2025 and December 31, 2024 is as follows (in thousands, except as noted):
| March 31, 2025 | December 31, 2024 | ||||||||||
| Operating leases: | |||||||||||
| Other assets | $ | 122,244 | $ | 118,839 | |||||||
| Accrued expenses | 33,357 | 32,626 | |||||||||
| Other noncurrent liabilities | 101,349 | 99,514 | |||||||||
| Total operating lease liabilities | 134,706 | 132,140 | |||||||||
| Finance leases: | |||||||||||
| Net property, plant and equipment | 115,304 | 117,038 | |||||||||
| Current portion of long-term debt | 5,283 | 5,183 | |||||||||
| Long-term debt | 112,589 | 113,613 | |||||||||
| Total finance lease liabilities | 117,872 | 118,796 | |||||||||
| Weighted average remaining lease term (in years): | |||||||||||
| Operating leases | 12.5 | 12.9 | |||||||||
| Finance leases | 20.2 | 20.4 | |||||||||
| Weighted average discount rate (%): | |||||||||||
| Operating leases | 4.55 | % | 4.47 | % | |||||||
| Finance leases | 5.55 | % | 5.55 | % |
Maturities of lease liabilities at March 31, 2025 were as follows (in thousands):
| Operating Leases | Finance Leases | ||||||||||
| Remainder of 2025 | $ | 26,068 | $ | 9,149 | |||||||
| 2026 | 26,603 | 11,338 | |||||||||
| 2027 | 21,032 | 11,269 | |||||||||
| 2028 | 15,615 | 11,131 | |||||||||
| 2029 | 13,731 | 11,131 | |||||||||
| Thereafter | 94,841 | 134,007 | |||||||||
| Total lease payments | 197,890 | 188,025 | |||||||||
| Less imputed interest | 63,184 | 70,153 | |||||||||
| Total | $ | 134,706 | $ | 117,872 |
NOTE 14—Fair Value of Financial Instruments:
In assessing the fair value of financial instruments, we use methods and assumptions that are based on market conditions and other risk factors existing at the time of assessment. Fair value information for our financial instruments is as follows:
Long-Term Debt—the fair values of our notes are estimated using Level 1 inputs and account for the difference between the recorded amount and fair value of our long-term debt. The carrying value of our remaining long-term debt reported in the accompanying consolidated balance sheets approximates fair value as substantially all of such debt bears interest based on prevailing variable market rates currently available in the countries in which we have borrowings.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| March 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
| Recorded Amount | Fair Value | Recorded Amount | Fair Value | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Long-term debt | $ | 3,554,963 | $ | 3,358,246 | $ | 3,532,713 | $ | 3,332,064 |
During the fourth quarter of 2019, we entered into a foreign currency forward contract to hedge the cash flow exposure of non-functional currency purchases during the construction of the Kemerton plant in Australia. This derivative financial instrument is used to manage risk and is not used for trading or other speculative purposes. This foreign currency forward contract has been designated as a hedging instrument under Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging. As a result of the actions taken at Kemerton Trains 3 and 4 during 2024, the Company dedesignated the remaining hedged foreign currency forward contracts. The Company recorded a loss in Other income, net of $0.2 million during the three-month period ended March 31, 2025 from the reclassification of the hedged balance from Accumulated other comprehensive loss. The balance of the settled hedged foreign currency forward contracts associated with the construction of Kemerton Trains 1 and 2 assets placed into service will be reclassified to earnings over the life of the related assets.
In connection with our risk management strategies, we also enter into other derivative financial instruments that have not been designated as hedging instruments under ASC 815, Derivatives and Hedging. These derivative financial instruments are used to manage risk and are not used for trading or other speculative purposes. At March 31, 2025 and December 31, 2024, we had outstanding non-designated derivative financial instruments with notional values totaling $6.5 billion and $6.9 billion, respectively. The non-designated derivative financial instruments are primarily comprised of foreign currency forward contracts that attempt to minimize the financial impact of changes in foreign currency exchange rates. The fair values of our non-designated foreign currency forward contracts are estimated based on current settlement values. At March 31, 2025, these foreign currency forward contracts hedge our exposure to various currencies including the Chinese Renminbi, Euro and Australian Dollar.
The following table summarizes the fair value of our derivative financial instruments included in the consolidated balance sheets as of March 31, 2025 and December 31, 2024 (in thousands):
| March 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
| Assets | Liabilities | Assets | Liabilities | ||||||||||||||||||||
| Not designated as hedging instruments | |||||||||||||||||||||||
| Other current assets | $ | 5,557 | $ | — | $ | 4,347 | $ | — | |||||||||||||||
| Accrued expenses | — | 5,919 | — | 6,586 | |||||||||||||||||||
| Other noncurrent liabilities | — | 4,819 | — | 4,766 | |||||||||||||||||||
| Total not designated as hedging instruments | $ | 5,557 | $ | 10,738 | $ | 4,347 | $ | 11,352 | |||||||||||||||
The following table summarizes the net (losses) gains recognized for our derivative financial instruments during the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Designated as hedging instruments | |||||||||||||||||||||||
| Loss recognized in Other comprehensive income (loss) | $ | (231) | $ | (21,342) | |||||||||||||||||||
| Loss recognized in Other income, net | $ | (124) | $ | (2,682) | |||||||||||||||||||
| Not designated as hedging instruments | |||||||||||||||||||||||
| Gain recognized in Other income, net(a) | $ | 52,078 | $ | 14,822 |
(a) Fluctuations in the value of our foreign currency forward contracts not designated as hedging instruments are generally expected to be offset by changes in the value of the underlying exposures being hedged, which are also reported in Other income, net.
In addition, for the three-month periods ended March 31, 2025 and 2024, we recorded net cash receipts of $50.3 million and $14.5 million, respectively, in Other, net, in our condensed consolidated statements of cash flows.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Unrealized gains and losses related to the cash flow hedges will be reclassified to earnings over the life of the related assets when settled and the related assets are placed into service.
The counterparties to our foreign currency forward contracts are major financial institutions with which we generally have other financial relationships. We are exposed to credit loss in the event of nonperformance by these counterparties. However, we do not anticipate nonperformance by the counterparties.
NOTE 15—Fair Value Measurement:
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The inputs used to measure fair value are classified into the following hierarchy:
| Level 1 | Unadjusted quoted prices in active markets for identical assets or liabilities | ||||
| Level 2 | Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability | ||||
| Level 3 | Unobservable inputs for the asset or liability |
We endeavor to utilize the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The following tables set forth our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2025 and December 31, 2024 (in thousands):
| March 31, 2025 | Quoted Prices in Active Markets for Identical Items (Level 1) | Quoted Prices in Active Markets for Similar Items (Level 2) | Unobservable Inputs (Level 3) | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Available for sale debt securities(a) | $ | 320,388 | $ | — | $ | — | $ | 320,388 | |||||||||||||||
| Investments under executive deferred compensation plan(b) | $ | 34,552 | $ | 34,552 | $ | — | $ | — | |||||||||||||||
| Public equity securities(c) | $ | 12,889 | $ | 12,889 | $ | — | $ | — | |||||||||||||||
| Private equity securities measured at net asset value(d)(e) | $ | 4,482 | $ | — | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(f) | $ | 5,557 | $ | — | $ | 5,557 | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Obligations under executive deferred compensation plan(b) | $ | 34,552 | $ | 34,552 | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(f) | $ | 10,738 | $ | — | $ | 10,738 | $ | — |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| December 31, 2024 | Quoted Prices in Active Markets for Identical Items (Level 1) | Quoted Prices in Active Markets for Similar Items (Level 2) | Unobservable Inputs (Level 3) | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Available for sale debt securities(a) | $ | 313,991 | $ | — | $ | — | $ | 313,991 | |||||||||||||||
| Investments under executive deferred compensation plan(b) | $ | 38,243 | $ | 38,243 | $ | — | $ | — | |||||||||||||||
| Public equity securities(c) | $ | 17,910 | $ | 17,910 | $ | — | $ | — | |||||||||||||||
| Private equity securities measured at net asset value(d)(e) | $ | 4,472 | $ | — | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(f) | $ | 4,347 | $ | — | $ | 4,347 | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Obligations under executive deferred compensation plan(b) | $ | 38,243 | $ | 38,243 | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(f) | $ | 11,352 | $ | — | $ | 11,352 | $ | — |
(a)Preferred equity of a Grace subsidiary acquired as a portion of the proceeds of the FCS sale on June 1, 2021. A third-party estimate of the fair value was prepared using expected future cash flows over the period up to when the asset is likely to be redeemed, applying a discount rate that appropriately captures a market participant's view of the risk associated with the investment. These are considered to be Level 3 inputs.
(b)We maintain an Executive Deferred Compensation Plan (“EDCP”) that was adopted in 2001 and subsequently amended. The purpose of the EDCP is to provide current tax planning opportunities as well as supplemental funds upon the retirement or death of certain of our employees. The EDCP is intended to aid in attracting and retaining employees of exceptional ability by providing them with these benefits. We also maintain a Benefit Protection Trust (the “Trust”) that was created to provide a source of funds to assist in meeting the obligations of the EDCP, subject to the claims of our creditors in the event of our insolvency. Assets of the Trust are consolidated in accordance with authoritative guidance. The assets of the Trust consist primarily of mutual fund investments (which are accounted for as trading securities and are marked-to-market on a monthly basis through the consolidated statements of income) and cash and cash equivalents. As such, these assets and obligations are classified within Level 1.
(c)Holdings in equity securities of public companies reported in Investments in the consolidated balance sheets. The fair value is measured using publicly available share prices of the investments, and as a result these balances are classified within Level 1. Any changes are reported in Other income, net in our consolidated statements of income. See Note 3, “Investments,” for further details.
(d)Primarily consists of private equity securities reported in Investments in the consolidated balance sheets. The changes in fair value are reported in Other income, net in our consolidated statements of income.
(e)Holdings in certain private equity securities are measured at fair value using the net asset value per share (or its equivalent) practical expedient and have not been categorized in the fair value hierarchy.
(f)The derivative financial instruments are primarily comprised of foreign currency forward contracts. As a result of our global operating and financing activities, we are exposed to market risks from changes in foreign currency exchange rates which may adversely affect our operating results and financial position. When deemed appropriate, we minimize our risks from foreign currency exchange rate fluctuations through the use of foreign currency forward contracts. The foreign currency forward contracts are valued using broker quotations or market transactions in either the listed or over-the-counter markets. As such, these derivative instruments are classified within Level 2. See Note 14, “Fair Value of Financial Instruments,” for further details about our foreign currency forward contracts.
The following table sets forth the reconciliation of the beginning and ending balance for the Level 3 recurring fair value measurements (in thousands):
| Available for Sale Debt Securities | |||||
| Beginning balance at December 31, 2024 | $ | 313,991 | |||
| PIK dividends | 9,769 | ||||
| Cash received for tax liability | (3,372) | ||||
| Ending balance at March 31, 2025 | $ | 320,388 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 16—Related Party Transactions:
Our consolidated statements of income include sales to and purchases from unconsolidated affiliates in the ordinary course of business as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Sales to unconsolidated affiliates | $ | 1,536 | $ | 1,958 | |||||||||||||||||||
| Purchases from unconsolidated affiliates(a) | $ | 159,206 | $ | 137,197 |
(a)Purchases from unconsolidated affiliates primarily relate to spodumene purchased from the Company’s Windfield joint venture.
Our consolidated balance sheets include accounts receivable due from and payable to unconsolidated affiliates in the ordinary course of business as follows (in thousands):
| March 31, 2025 | December 31, 2024 | ||||||||||
| Receivables from unconsolidated affiliates | $ | 947 | $ | 11,950 | |||||||
| Payables to unconsolidated affiliates(a) | $ | 139,296 | $ | 150,432 |
(a)Payables to unconsolidated affiliates primarily relate to spodumene purchased from the Company’s Windfield joint venture under normal payment terms.
NOTE 17—Segment Information:
The Company has three operating and reportable segments, which are: (1) Energy Storage; (2) Specialties; and (3) Ketjen. The segments are organized based on their similar markets, customers, economic characteristics and production processes. The organizational structure facilitates the continued standardization of business processes across the organization, and is consistent with the manner in which information is presently used internally by the Company’s Chairman, President and Chief Executive Officer, who is the Company’s chief operating decision maker (“CODM”), to evaluate performance and make resource allocation decisions.
The Corporate category is not considered to be a segment and includes corporate-related items not allocated to the operating segments. Pension and other post-employment benefit (“OPEB”) service cost (which represents the benefits earned by active employees during the period) and amortization of prior service cost or benefit are allocated to the reportable segments and Corporate, whereas the remaining components of pension and OPEB benefits cost or credit (“Non-operating pension and OPEB items”) are included in Corporate. Segment data includes inter-segment transfers of raw materials at cost and allocations for certain corporate costs.
The CODM uses adjusted EBITDA (as defined below) to assess the ongoing performance of the Company’s business segments and to allocate resources by considering the variance in the actual results to the forecasts on a monthly basis. The annual operating budget and ongoing forecasting process use adjusted EBITDA as a key metric in assessing the segments performance. In addition, the CODM uses adjusted EBITDA for business and enterprise planning purposes and as a significant component in the calculation of performance-based compensation for management and other employees. The Company’s definition of adjusted EBITDA is earnings before interest and financing expenses, income tax expenses, the proportionate share of Windfield income tax expense, depreciation and amortization, as adjusted on a consistent basis for certain non-operating, non-recurring or unusual items on a segment basis. These non-operating, non-recurring or unusual items may include acquisition and integration related costs, gains or losses on sales of businesses, restructuring charges and asset write-offs, facility divestiture charges, certain litigation and arbitration costs and charges, non-operating pension and OPEB items and other significant non-recurring items. This calculation is consistent with the definition of adjusted EBITDA used in the leverage financial covenant calculation in the Company’s credit agreement, which is a material agreement for the Company and aligns the information presented to various stakeholders.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
See below for a reconciliation of segment Net sales to adjusted EBITDA by segment showing significant segment expenses regularly reviewed by the CODM for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Energy Storage | Specialties | Ketjen | Total Segments | ||||||||||||||||||||
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||
| Net sales(a) | $ | 524,565 | $ | 321,014 | $ | 231,302 | $ | 1,076,881 | |||||||||||||||
| Cost of goods sold(b) | (365,521) | (231,226) | (173,477) | (770,224) | |||||||||||||||||||
| Selling, general and administrative expenses(b) | (44,535) | (20,379) | (22,025) | (86,939) | |||||||||||||||||||
| Other segment items(c) | (2,550) | (2,793) | (6,512) | (11,855) | |||||||||||||||||||
| Equity in net income of unconsolidated investments(d) | 74,396 | — | 9,300 | 83,696 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | — | (7,950) | — | (7,950) | |||||||||||||||||||
| Adjusted EBITDA by segment | $ | 186,355 | $ | 58,666 | $ | 38,588 | $ | 283,609 | |||||||||||||||
| Three Months Ended March 31, 2024 | |||||||||||||||||||||||
| Net sales(a) | $ | 800,898 | $ | 316,065 | $ | 243,773 | $ | 1,360,736 | |||||||||||||||
| Cost of goods sold(b) | (776,582) | (225,163) | (202,417) | (1,204,162) | |||||||||||||||||||
| Selling, general and administrative expenses(b) | (64,414) | (24,970) | (19,926) | (109,310) | |||||||||||||||||||
| Other segment items(c) | (6,638) | (7,634) | (7,272) | (21,544) | |||||||||||||||||||
| Equity in net income of unconsolidated investments(d) | 244,732 | — | 7,821 | 252,553 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | — | (13,117) | — | (13,117) | |||||||||||||||||||
| Adjusted EBITDA by segment | $ | 197,996 | $ | 45,181 | $ | 21,979 | $ | 265,156 |
(a)Intersegment sales are not considered material.
(b)The significant expense categories and amounts align with the segment information that is regularly provided to the CODM. Excludes depreciation and amortization, and non-operating, non-recurring or unusual items as described in the reconciliation of total segment adjusted EBITDA to consolidated Net income attributable to Albemarle Corporation below.
(c)Other segment items are comprised of Research and development expenses excluding depreciation and amortization.
(d)Excludes Albemarle’s 49% ownership interest in the income tax expense of the Windfield joint venture.
The Company reconciles the total segment adjusted EBITDA to the consolidated Net income attributable to Albemarle Corporation given the impact of equity in net income from unconsolidated investments, the majority of which relates to the Windfield joint venture. This reconciliation reflects the strategic and operational significance of the Company’s joint ventures and aligns with our allocation of equity in net income from unconsolidated investments at the segment level, representing each segment's contribution to the Company's overall financial performance. See below for a reconciliation of total segment adjusted EBITDA to consolidated Net income attributable to Albemarle Corporation (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Total segment adjusted EBITDA | $ | 283,609 | $ | 265,156 | |||||||||||||||||||
| Corporate expenses, net | (16,465) | 26,080 | |||||||||||||||||||||
| Depreciation and amortization | (161,754) | (123,751) | |||||||||||||||||||||
| Interest and financing expenses | (48,977) | (37,969) | |||||||||||||||||||||
| Income tax benefit | 3,978 | 3,721 | |||||||||||||||||||||
| Proportionate share of Windfield income tax expense(a) | (25,326) | (73,689) | |||||||||||||||||||||
| Acquisition and integration related costs(b) | (1,440) | (1,907) | |||||||||||||||||||||
| Restructuring charges and asset write-offs(c) | 833 | (36,285) | |||||||||||||||||||||
| Non-operating pension and OPEB items | (275) | 325 | |||||||||||||||||||||
| Loss in fair value of public equity securities(d) | (5,022) | (43,159) | |||||||||||||||||||||
| Other(e) | 12,187 | 23,926 | |||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 41,348 | $ | 2,448 |
(a)Albemarle’s 49% ownership interest in the reported income tax expense of the Windfield joint venture.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(b)Costs related to the acquisition, integration and potential divestitures for various significant projects, recorded in Selling, general and administrative expenses (“SG&A”).
(c)See Note 9, “Restructuring Charges and Asset Write-offs,” for further details.
(d)Represents the net change in fair value of investments in public equity securities for the three-month period ended March 31, 2025, recorded in Other income, net. The three-month period ended March 31, 2024 included losses of $9.4 million and $33.7 million, recorded in Other income, net, resulting from the net change in fair value of investments in public equity securities and the sale of investments in public equity securities, respectively.
(e)Included amounts for the three months ended March 31, 2025 recorded in:
-
SG&A - $3.2 million of gains from the sale of assets at a site not part of our production operations, partially offset by $0.6 million of expenses related to certain historical legal matters.
-
Other income, net - $9.8 million of income from PIK dividends of preferred equity in a Grace subsidiary and a $1.9 million gain primarily resulting from the adjustment of indemnification related to previously disposed businesses, partially offset by $1.9 million of charges for asset retirement obligations at a site not part of our operations.
Included amounts for the three months ended March 31, 2024 recorded in:
-
Cost of goods sold - $1.4 million of expenses related to non-routine labor and compensation related costs that are outside normal compensation arrangements.
-
SG&A - $0.1 million of expenses related to certain historical legal matters.
-
Other income, net - $17.3 million gain primarily from the sale of assets at a site not part of our operations, $8.7 million of income from PIK dividends of preferred equity in a Grace subsidiary and a $2.4 million gain primarily resulting from the adjustment of indemnification related to previously disposed businesses, partially offset by $2.9 million of charges for asset retirement obligations at a site not part of our operations.
Total assets and investments in equity method investees by segment at March 31, 2025 and December 31, 2024 were as follows (in thousands):
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| Assets: | |||||||||||
| Energy Storage | $ | 11,360,332 | $ | 11,285,847 | |||||||
| Specialties | 1,856,357 | 1,843,564 | |||||||||
| Ketjen | 1,449,129 | 1,426,189 | |||||||||
| Total segment assets | 14,665,818 | 14,555,600 | |||||||||
| Corporate | 2,333,440 | 2,054,049 | |||||||||
| Total assets | $ | 16,999,258 | $ | 16,609,649 | |||||||
| Investments in equity method investees: | |||||||||||
| Energy Storage | $ | 585,648 | $ | 585,569 | |||||||
| Ketjen | 150,119 | 140,915 | |||||||||
| Total investments in equity method investees | $ | 735,767 | $ | 726,484 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Additional segment information for the three-month periods ended March 31, 2025 and 2024 was as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||||||||
| Energy Storage | $ | 120,348 | $ | 87,274 | |||||||||||||||||||
| Specialties | 25,733 | 22,437 | |||||||||||||||||||||
| Ketjen | 13,430 | 12,357 | |||||||||||||||||||||
| Total segment depreciation and amortization | 159,511 | 122,068 | |||||||||||||||||||||
| Corporate | 2,243 | 1,683 | |||||||||||||||||||||
| Total depreciation and amortization | $ | 161,754 | $ | 123,751 | |||||||||||||||||||
| Equity in net income of unconsolidated investments (net of tax): | |||||||||||||||||||||||
| Energy Storage | $ | 50,845 | $ | 171,534 | |||||||||||||||||||
| Ketjen | 9,300 | 7,821 | |||||||||||||||||||||
| Total segment equity in net income of unconsolidated investments (net of tax) | 60,145 | 179,355 | |||||||||||||||||||||
| Corporate(a) | 4,141 | 1,145 | |||||||||||||||||||||
| Total equity in net income of unconsolidated investments (net of tax) | $ | 64,286 | $ | 180,500 | |||||||||||||||||||
| Capital expenditures: | |||||||||||||||||||||||
| Energy Storage | $ | 94,443 | $ | 445,313 | |||||||||||||||||||
| Specialties | 62,225 | 89,145 | |||||||||||||||||||||
| Ketjen | 22,371 | 35,183 | |||||||||||||||||||||
| Total segment capital expenditures | 179,039 | 569,641 | |||||||||||||||||||||
| Corporate | 3,585 | 9,681 | |||||||||||||||||||||
| Total capital expenditures | $ | 182,624 | $ | 579,322 |
(a)Corporate equity in net income of unconsolidated investments (net of tax) relates to foreign exchange gains or losses from the Windfield joint venture.
NOTE 18—Supplemental Cash Flow Information:
Supplemental information related to the condensed consolidated statements of cash flows is as follows (in thousands):
| Three Months Ended March 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Supplemental non-cash disclosure related to investing and financing activities: | |||||||||||
| Capital expenditures included in Accounts payable | $ | 127,369 | $ | 315,895 | |||||||
| Common stock issued for annual incentive bonus plan(a) | — | 11,545 | |||||||||
(a)During the three-month period ended March 31, 2024, the Company issued 95,003 shares of common stock to certain employees in lieu of cash as payment of a portion of their 2023 annual incentive bonus plan.
Noncurrent liability changes and other, net within Cash flows from operating activities on the condensed consolidated statements of cash flows for the three-month period ended March 31, 2025 included the receipt of a $350.0 million customer prepayment. See Note 6, “Other Noncurrent Liabilities,” for further details.
NOTE 19—Recently Issued or Adopted Accounting Pronouncements:
In August 2023, the FASB issued guidance which will require a joint venture to recognize and initially measure its assets, including goodwill, and liabilities using a new basis of accounting upon formation. Initial measurement of a joint venture’s total net assets will be equal to the fair value of one hundred percent of the joint venture’s equity. In addition, a joint venture will be permitted to apply the measurement period guidance of ASC 805-10 if the initial accounting for the joint venture formation is
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
incomplete by the end of the reporting period in which the formation occurs. This guidance is effective prospectively for all joint venture formations with a formation date on or after January 1, 2025. The Company currently does not expect this guidance to have a significant impact on its consolidated financial statements.
In November 2023, the FASB issued guidance to update qualitative and quantitative reportable segment disclosure requirements, including enhanced disclosures about significant segment expenses and increased interim disclosure requirements, among others. This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company has adopted this guidance and provided the required disclosures in this Quarterly Report on Form 10-Q. See Note 17, “Segment Information,” for further details.
In December 2023, the FASB issued guidance to require qualitative and quantitative updates to the rate reconciliation and income taxes paid disclosures, among others, in order to enhance the transparency of income tax disclosures, including consistent categories and greater disaggregation of information in the rate reconciliation and disaggregation by jurisdiction of income taxes paid. This guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments should be applied prospectively; however, retrospective application is also permitted. The Company is currently evaluating the impact this guidance will have on its financial statement disclosures.
In November 2024, the FASB issued guidance to require tabular disclosures disaggregating certain types of expenses presented on the income statement within continuing operations, as well as disclosures about selling expenses. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted, and the amendments should be applied prospectively; however, retrospective application is also permitted. The Company is currently evaluating the impact this guidance will have on its financial statement disclosures.
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