filings.toolsItem 1. Financial Statements (Unaudited).
136K characters. Original on sec.gov · Markdown
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, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net sales | $ | 1,428,731 | $ | 1,076,881 | |||||||||||||||||||
| Cost of goods sold(a) | 927,765 | 920,582 | |||||||||||||||||||||
| Gross profit | 500,966 | 156,299 | |||||||||||||||||||||
| Selling, general and administrative expenses | 137,406 | 123,502 | |||||||||||||||||||||
| Restructuring charges and asset write-offs | 25,866 | (1,063) | |||||||||||||||||||||
| Research and development expenses | 9,170 | 14,099 | |||||||||||||||||||||
| Loss on sale of business | 95,018 | — | |||||||||||||||||||||
| Operating profit | 233,506 | 19,761 | |||||||||||||||||||||
| Interest and financing expenses | (33,121) | (48,977) | |||||||||||||||||||||
| Other income, net | 53,810 | 10,250 | |||||||||||||||||||||
| Income (loss) before income taxes and equity in net income of unconsolidated investments | 254,195 | (18,966) | |||||||||||||||||||||
| Income tax expense (benefit) | 21,511 | (3,978) | |||||||||||||||||||||
| Income (loss) before equity in net income of unconsolidated investments | 232,684 | (14,988) | |||||||||||||||||||||
| Equity in net income of unconsolidated investments (net of tax) | 96,293 | 64,286 | |||||||||||||||||||||
| Net income | 328,977 | 49,298 | |||||||||||||||||||||
| Net income attributable to noncontrolling interests | (9,886) | (7,950) | |||||||||||||||||||||
| Net income attributable to Albemarle Corporation | 319,091 | 41,348 | |||||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (41,688) | |||||||||||||||||||||
| Net income (loss) attributable to Albemarle Corporation common shareholders | $ | 277,403 | $ | (340) | |||||||||||||||||||
| Basic earnings (loss) per share attributable to common shareholders | $ | 2.35 | $ | (0.00) | |||||||||||||||||||
| Diluted earnings (loss) per share attributable to common shareholders | $ | 2.34 | $ | (0.00) | |||||||||||||||||||
| Weighted-average common shares outstanding – basic | 117,854 | 117,603 | |||||||||||||||||||||
| Weighted-average common shares outstanding – diluted | 118,607 | 117,603 |
(a)Included purchases from related unconsolidated affiliates of $128.2 million and $119.8 million for the three-month periods ended March 31, 2026 and 2025, respectively.
See accompanying Notes to the Condensed Consolidated Financial Statements.
ALBEMARLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
(Unaudited)
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net income | $ | 328,977 | $ | 49,298 | |||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Foreign currency translation and other | 75,767 | 109,015 | |||||||||||||||||||||
| Cash flow hedge | (107) | (107) | |||||||||||||||||||||
| Total other comprehensive income, net of tax | 75,660 | 108,908 | |||||||||||||||||||||
| Comprehensive income | 404,637 | 158,206 | |||||||||||||||||||||
| Comprehensive income attributable to noncontrolling interests | (9,851) | (7,932) | |||||||||||||||||||||
| Comprehensive income attributable to Albemarle Corporation | $ | 394,786 | $ | 150,274 |
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, | ||||||||||
| 2026 | 2025 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 1,089,809 | $ | 1,618,001 | |||||||
| Trade accounts receivable, less allowance for credit losses (2026 – $4,580; 2025 – $4,578) | 522,715 | 593,502 | |||||||||
| Other accounts receivable | 136,767 | 105,110 | |||||||||
| Inventories | 1,346,960 | 1,179,271 | |||||||||
| Other current assets | 162,932 | 140,440 | |||||||||
| Current assets held for sale | — | 371,815 | |||||||||
| Total current assets | 3,259,183 | 4,008,139 | |||||||||
| Property, plant and equipment, at cost | 11,822,899 | 11,768,840 | |||||||||
| Less accumulated depreciation and amortization | 3,297,806 | 3,156,429 | |||||||||
| Net property, plant and equipment | 8,525,093 | 8,612,411 | |||||||||
| Investments | 1,022,707 | 900,926 | |||||||||
| Other assets | 636,574 | 647,185 | |||||||||
| Goodwill | 1,488,404 | 1,499,657 | |||||||||
| Other intangibles, net of amortization | 207,617 | 214,233 | |||||||||
| Noncurrent assets held for sale | — | 491,660 | |||||||||
| Total assets | $ | 15,139,578 | $ | 16,374,211 | |||||||
| Liabilities And Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable to third parties | $ | 677,151 | $ | 779,160 | |||||||
| Accounts payable to related parties | 256,630 | 134,369 | |||||||||
| Accrued expenses | 452,927 | 521,831 | |||||||||
| Current portion of long-term debt | 74,628 | 74,077 | |||||||||
| Dividends payable | 61,456 | 61,387 | |||||||||
| Income taxes payable | 53,139 | 35,467 | |||||||||
| Current liabilities held for sale | — | 191,753 | |||||||||
| Total current liabilities | 1,575,931 | 1,798,044 | |||||||||
| Long-term debt | 1,807,203 | 3,119,464 | |||||||||
| Postretirement benefits | 45,075 | 44,744 | |||||||||
| Pension benefits | 115,451 | 117,361 | |||||||||
| Other noncurrent liabilities | 1,118,508 | 1,084,892 | |||||||||
| Deferred income taxes | 369,294 | 368,275 | |||||||||
| Noncurrent liabilities held for sale | — | 59,970 | |||||||||
| Commitments and contingencies (Note 8) | |||||||||||
| Equity: | |||||||||||
| Albemarle Corporation shareholders’ equity: | |||||||||||
| Common stock, $.01 par value, authorized – 275,000, issued and outstanding – 117,886 in 2026 and 117,716 in 2025 | 1,179 | 1,178 | |||||||||
| Mandatory convertible preferred stock, Series A, no par value, $1,000 stated value, authorized – 15,000, issued and outstanding – 2,300 in 2026 and 2025 | 2,235,105 | 2,235,105 | |||||||||
| Additional paid-in capital | 3,029,667 | 3,018,213 | |||||||||
| Accumulated other comprehensive loss | (259,112) | (334,807) | |||||||||
| Retained earnings | 4,843,335 | 4,613,676 | |||||||||
| Total Albemarle Corporation shareholders’ equity | 9,850,174 | 9,533,365 | |||||||||
| Noncontrolling interests | 257,942 | 248,096 | |||||||||
| Total equity | 10,108,116 | 9,781,461 | |||||||||
| Total liabilities and equity | $ | 15,139,578 | $ | 16,374,211 |
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, 2025 | 117,715,875 | $ | 1,178 | 2,300,000 | $ | 2,235,105 | $ | 3,018,213 | $ | (334,807) | $ | 4,613,676 | $ | 9,533,365 | $ | 248,096 | $ | 9,781,461 | |||||||||||||||||||||||||||||||||||||||||
| Net income | 319,091 | 319,091 | 9,886 | 328,977 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | 75,695 | 75,695 | (35) | 75,660 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock dividends declared, $0.405 per common share | (47,744) | (47,744) | — | (47,744) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Mandatory convertible preferred stock cumulative dividends | (41,688) | (41,688) | (41,688) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 6,477 | 6,477 | 6,477 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | 97,205 | — | 8,917 | 8,917 | 8,917 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net | 122,039 | 1 | (1) | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in ownership interest of noncontrolling interest | — | — | (5) | (5) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Withholding taxes paid on stock-based compensation award distributions | (49,325) | — | (3,939) | (3,939) | (3,939) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | 117,885,794 | $ | 1,179 | 2,300,000 | $ | 2,235,105 | $ | 3,029,667 | $ | (259,112) | $ | 4,843,335 | $ | 9,850,174 | $ | 257,942 | $ | 10,108,116 | |||||||||||||||||||||||||||||||||||||||||
| 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 |
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, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash and cash equivalents at beginning of year | $ | 1,618,001 | $ | 1,192,230 | |||||||
| Cash flows from operating activities: | |||||||||||
| Net income | 328,977 | 49,298 | |||||||||
| Adjustments to reconcile net income to cash flows from operating activities: | |||||||||||
| Depreciation and amortization | 157,805 | 161,754 | |||||||||
| Loss on sale of business | 95,018 | — | |||||||||
| Gain on sale of equity investment | (42,300) | — | |||||||||
| Stock-based compensation and other | 7,883 | 6,966 | |||||||||
| Equity in net income of unconsolidated investments (net of tax) | (96,293) | (64,286) | |||||||||
| Dividends received from unconsolidated investments and nonmarketable securities | — | 60,335 | |||||||||
| Pension and postretirement expense | 2,921 | 1,696 | |||||||||
| Pension and postretirement contributions | (3,204) | (5,196) | |||||||||
| Unrealized loss on investments in marketable securities | 5,137 | 5,331 | |||||||||
| Gain on early extinguishment of debt | (12,591) | — | |||||||||
| Deferred income taxes | (1,005) | (5,669) | |||||||||
| Working capital changes | (144,430) | (21,992) | |||||||||
| Noncurrent liability changes and other, net | 48,326 | 358,970 | |||||||||
| Net cash provided by operating activities | 346,244 | 547,207 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (98,676) | (182,624) | |||||||||
| Proceeds from sale of businesses, net of cash sold | 525,156 | — | |||||||||
| Proceeds from sale of investments | 123,270 | — | |||||||||
| (Payments) proceeds from settlement of foreign currency forward contracts, net | (10,514) | 50,245 | |||||||||
| Sales of marketable securities, net | 1,785 | 3,381 | |||||||||
| Investments in equity investments and nonmarketable securities | (59) | (60) | |||||||||
| Net cash provided by (used in) investing activities | 540,962 | (129,058) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Repayments of long-term debt and credit agreements | (1,296,595) | (9,615) | |||||||||
| Proceeds from borrowings of long-term debt and credit agreements | 18,396 | — | |||||||||
| Other debt repayments, net | (11,237) | (1,195) | |||||||||
| Fees related to early extinguishment of debt | (1,639) | — | |||||||||
| Dividends paid to common shareholders | (47,667) | (47,607) | |||||||||
| Dividends paid to mandatory convertible preferred shareholders | (41,688) | (41,688) | |||||||||
| Dividends paid to noncontrolling interests | (37,462) | (18,169) | |||||||||
| Proceeds from exercise of stock options | 8,917 | 1,186 | |||||||||
| Withholding taxes paid on stock-based compensation award distributions | (3,939) | (2,904) | |||||||||
| Other | (438) | (14) | |||||||||
| Net cash used in financing activities | (1,413,352) | (120,006) | |||||||||
| Net effect of foreign exchange on cash and cash equivalents | (2,046) | 28,138 | |||||||||
| (Decrease) increase in cash and cash equivalents | (528,192) | 326,281 | |||||||||
| Cash and cash equivalents at end of period | $ | 1,089,809 | $ | 1,518,511 |
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, 2026 and December 31, 2025, our consolidated statements of income, consolidated statements of comprehensive income and consolidated statements of changes in equity for the three-month periods ended March 31, 2026 and 2025 and our condensed consolidated statements of cash flows for the three-month periods ended March 31, 2026 and 2025. 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, 2025, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 11, 2026. The December 31, 2025 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 period ended March 31, 2026 are not necessarily indicative of the results to be expected for the full year. Certain reclassifications have been made to the accompanying condensed consolidated financial statements and the notes thereto to conform to the current presentation.
Revision of Previously Issued Financial Information
As previously reported in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2025, during the second quarter of 2025, the Company identified an error in classification within its condensed consolidated statements of cash flows related to the proceeds from settlement and unrealized gains or losses from foreign currency forward contracts, affecting the cash flows from operating activities section, the cash flows from investing activities section and the Net effect of foreign exchange on cash and cash equivalents line of the statements of cash flows. The identified misclassification impacted our previously filed annual financial statements for the fiscal years ended December 31, 2024, 2023 and 2022, and quarterly financial statements for each of the fiscal quarters of fiscal year 2024 and the first fiscal quarter of fiscal year 2025 (collectively, the “Prior Financial Statements”). In addition, the Company made adjustments to correct for other previously identified immaterial errors in certain periods. The Company assessed the materiality of the error in accordance with the SEC’s Staff Accounting Bulletin (“SAB”) No. 99 and SAB No. 108 and determined that the resulting misclassification was not material in any of the Prior Financial Statements, individually or in the aggregate. This revision had no impact on the consolidated balance sheets, consolidated statements of income (loss), consolidated statements of comprehensive income (loss), or consolidated statements of changes in equity of the Prior Financial Statements or notes thereto.
A summary of the revisions to the impacted period presented in this Quarterly Report on Form 10-Q are shown below (in thousands):
| Three Months Ended March 31, 2025 | |||||||||||||||||
| As Reported | Revision | As Revised | |||||||||||||||
| Noncurrent liability changes and other, net | $ | 357,146 | $ | 1,824 | $ | 358,970 | |||||||||||
| Net cash provided by operating activities | 545,383 | 1,824 | 547,207 | ||||||||||||||
| Proceeds from settlement of foreign currency forward contracts, net | $ | — | $ | 50,245 | $ | 50,245 | |||||||||||
| Net cash used in investing activities | (179,303) | 50,245 | (129,058) | ||||||||||||||
| Net effect of foreign exchange on cash and cash equivalents | $ | 80,207 | $ | (52,069) | $ | 28,138 |
NOTE 2—Divestitures:
On October 25, 2025, the Company signed a definitive agreement to divest the controlling ownership interest of its Refining Solutions business to ChemCat AcquisitionCo, LLC and contribute the remaining ownership interest to ChemCat Holdings, LP, a newly formed limited partnership (“Holdco”), with the sale closing on March 2, 2026. The Refining Solutions business that was divested and contributed is defined as the Company’s Ketjen reportable segment, excluding its performance catalysts solutions (“PCS”) business and the Company’s 50% ownership interest in Eurecat S.A. (which the Company divested in a separate transaction as described below). Following the completion of the transactions in the definitive agreement
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(collectively, the “Refining Solutions Business Transaction”), the Company received $525.2 million in cash, net of cash sold, owns 49% of the common units of Holdco and retains 100% ownership of the PCS business. As a result of the Refining Solutions Business Transaction, the Company recorded a loss of $95.0 million before income taxes in the first quarter of 2026.
The Company’s ownership interest in Holdco, initially representing a 49% interest, consists of common units that are junior to the preferred equity in Holdco held by the other ownership group. The preferred equity accrues dividends, regardless of whether or not declared, for the first five years after the closing of the Refining Solutions Business Transaction, and is convertible into common equity of Holdco at the option of the holder.
In a separate transaction, on January 23, 2026, the Company completed the sale of its 50% ownership interest in Eurecat S.A., a joint venture included in the Refining Solutions reporting unit, for €105 million (approximately $123 million using foreign exchange rates on the closing date) in cash, to Axens SA and recorded a gain before income taxes of $42.3 million in Other income, net on the consolidated statements of income in the first quarter of 2026.
In connection with the Company’s entry into the definitive agreement related to the Refining Solutions business divestiture, on October 25, 2025, the Company concluded the Refining Solutions business met the criteria to be classified as held for sale in the Company’s consolidated financial statements. As such, the assets and liabilities of the Refining Solutions business were included in the current or noncurrent assets held for sale and liabilities held for sale, respectively, in the consolidated balance sheet at December 31, 2025. The Eurecat S.A. investment was separate from the Refining Solutions Business Transaction, and was not classified as held for sale. Upon classification as held for sale, the Refining Solutions business is measured at the lower of its carrying amount or its fair value less costs to sell.
The carrying amounts of the major classes of assets and liabilities that were classified as held for sale at December 31, 2025 were as follows (in thousands):
| December 31, 2025 | |||||
| Assets | |||||
| Trade accounts receivable | $ | 179,502 | |||
| Inventories | 188,750 | ||||
| Other current assets | 3,563 | ||||
| Current assets held for sale | 371,815 | ||||
| Property, plant and equipment, at cost | 1,043,529 | ||||
| Less accumulated depreciation and amortization | 645,438 | ||||
| Net property, plant and equipment | 398,091 | ||||
| Investments(a) | 64,125 | ||||
| Other intangibles, net of amortization and other noncurrent assets | 29,444 | ||||
| Noncurrent assets held for sale | 491,660 | ||||
| Total assets held for sale | $ | 863,475 | |||
| Liabilities | |||||
| Accounts payable to third parties | $ | 116,397 | |||
| Accrued expenses and other current liabilities | 75,356 | ||||
| Current liabilities held for sale | 191,753 | ||||
| Deferred income taxes | 44,311 | ||||
| Other noncurrent liabilities | 15,659 | ||||
| Noncurrent liabilities held for sale | 59,970 | ||||
| Total liabilities held for sale | $ | 251,723 |
(a) Does not include the Company’s Eurecat investment of $81.9 million, which was not part of the Refining Solutions business transaction or classified as held for sale.
Neither the Refining Solutions business nor the investment in Eurecat S.A. qualified for discontinued operations treatment at December 31, 2025 because the Company’s management did not consider these sales as representing a strategic shift that had or will have a major effect on the Company’s operations and financial results.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 3—Inventories:
The following table provides a breakdown of inventories at March 31, 2026 and December 31, 2025 (in thousands):
| March 31, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| Finished goods | $ | 797,639 | $ | 620,738 | |||||||
| Raw materials and work in process(a) | 399,761 | 414,232 | |||||||||
| Stores, supplies and other | 149,560 | 144,301 | |||||||||
| Total | $ | 1,346,960 | $ | 1,179,271 |
(a)Includes $312.7 million and $297.9 million at March 31, 2026 and December 31, 2025, respectively, of work in process in our Energy Storage segment.
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 $83.3 million and $37.2 million at March 31, 2026 and December 31, 2025, 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 4—Investments:
Unconsolidated Joint Ventures
Following the completion of the Refining Solutions Business Transaction discussed in Note 2, “Divestitures,” the Company retains an initial 49% ownership interest in the Ketjen joint venture. The Company’s valuation of its investment in this Ketjen joint venture was measured using the Black-Scholes option-pricing model using key assumptions such as equity volatility, a risk-free rate and certain terms of the joint venture agreement. This nonrecurring fair value measurement is classified as Level 3 within the fair value hierarchy due to the unobservable inputs used. The Company’s investment in this unconsolidated joint venture is reported within Investments on the consolidated balance sheet. In addition, the Company divested all of its direct ownership interests in Nippon Ketjen Company Limited and Fábrica Carioca de Catalisadores S.A., joint ventures included in the Refining Solutions Business Transaction. The investment balances for these unconsolidated investments were reported within Noncurrent assets held for sale at December 31, 2025.
In a separate transaction, on January 23, 2026, the Company divested its 50% ownership interest in the Eurecat S.A joint venture and recorded a gain of $42.3 million in Other income, net on the consolidated statements of income during the three-month period ended March 31, 2026.
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, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Windfield | $ | 93,292 | $ | 54,986 | |||||||||||||||||||
| Other joint ventures | 3,001 | 9,300 | |||||||||||||||||||||
| Total | $ | 96,293 | $ | 64,286 |
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 $892.5 million and $735.3 million at March 31, 2026 and December 31, 2025, respectively. 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
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
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, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net sales | $ | 581,057 | $ | 290,419 | |||||||||||||||||||
| Gross profit | 453,303 | 192,704 | |||||||||||||||||||||
| Income before income taxes | 406,662 | 144,796 | |||||||||||||||||||||
| Net income | 284,664 | 101,744 |
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, 2026 and 2025, the Company recorded unrealized mark-to-market losses of $5.5 million and $5.0 million, respectively, in Other income, net for all public equity securities held at the end of the balance sheet date.
NOTE 5—Goodwill and Other Intangibles:
The following table summarizes the changes in goodwill by reportable segment for the three-month period ended March 31, 2026 (in thousands):
| Energy Storage | Specialties | Total | |||||||||||||||||||||||||||
| Balance at December 31, 2025(a) | $ | 1,466,959 | $ | 32,698 | $ | 1,499,657 | |||||||||||||||||||||||
| Foreign currency translation adjustments | (11,294) | 41 | (11,253) | ||||||||||||||||||||||||||
| Balance at March 31, 2026(a) | $ | 1,455,665 | $ | 32,739 | $ | 1,488,404 |
(a) Balance as of March 31, 2026 and December 31, 2025 included an accumulated impairment loss of $6.8 million from the PCS reporting unit that is now reported within Corporate and All Other. Goodwill reported in Energy Storage and Specialties as of March 31, 2026 and December 31, 2025 relates entirely to the Energy Storage and Specialties reporting units, respectively.
The following table summarizes the changes in other intangibles and related accumulated amortization for the three-month period ended March 31, 2026 (in thousands):
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| Customer Lists and Relationships | Patents and Technology | Other**(a)** | Total | ||||||||||||||||||||||||||
| Gross Asset Value | |||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | 384,331 | $ | 32,480 | $ | 31,451 | $ | 448,262 | |||||||||||||||||||||
| Foreign currency translation adjustments and other | (4,709) | 689 | 16 | (4,004) | |||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | 379,622 | $ | 33,169 | $ | 31,467 | $ | 444,258 | |||||||||||||||||||||
| Accumulated Amortization | |||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | (206,071) | $ | (15,262) | $ | (12,696) | $ | (234,029) | |||||||||||||||||||||
| Amortization | (4,349) | (631) | (250) | (5,230) | |||||||||||||||||||||||||
| Foreign currency translation adjustments and other | 2,753 | (118) | (17) | 2,618 | |||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | (207,667) | $ | (16,011) | $ | (12,963) | $ | (236,641) | |||||||||||||||||||||
| Net Book Value at December 31, 2025 | $ | 178,260 | $ | 17,218 | $ | 18,755 | $ | 214,233 | |||||||||||||||||||||
| Net Book Value at March 31, 2026 | $ | 171,955 | $ | 17,158 | $ | 18,504 | $ | 207,617 |
(a) Following the completion of the sale of our Refining Solutions business, the remaining Trade Names and Trademarks balance was moved to Other. The Net Book Value of Trade Names and Trademarks includes only indefinite-lived intangible assets.
NOTE 6—Long-Term Debt:
Long-term debt at March 31, 2026 and December 31, 2025 consisted of the following (in thousands):
| March 31, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| 1.625% notes due 2028 | $ | 576,350 | $ | 588,600 | |||||||
| 3.45% Senior notes due 2029 | 109,240 | 171,612 | |||||||||
| 4.65% Senior notes due 2027 | — | 650,000 | |||||||||
| 5.05% Senior notes due 2032 | 415,726 | 600,000 | |||||||||
| 5.45% Senior notes due 2044 | 200,966 | 350,000 | |||||||||
| 5.65% Senior notes due 2052 | 195,680 | 450,000 | |||||||||
| Interest-free loan | 300,000 | 300,000 | |||||||||
| Variable-rate foreign bank loans | 17,528 | 17,892 | |||||||||
| Finance lease obligations | 105,823 | 106,796 | |||||||||
| Other | 10,500 | 20,500 | |||||||||
| Unamortized discount and debt issuance costs | (49,982) | (61,859) | |||||||||
| Total long-term debt | 1,881,831 | 3,193,541 | |||||||||
| Less amounts due within one year | 74,628 | 74,077 | |||||||||
| Long-term debt, less current portion | $ | 1,807,203 | $ | 3,119,464 |
In the three-month period ended March 31, 2026, using proceeds from the sale of our Refining Solutions business and cash on hand, we redeemed the 4.65% Senior notes in full, and repurchased $62.4 million of the 3.45% Senior notes, $184.3 million of the 5.05% Senior notes, $149.0 million of the 5.45% Senior notes, and $254.3 million of the 5.65% Senior notes. As a result, included in Interest and financing expenses for the three-month period ended March 31, 2026 is a gain on early extinguishment of debt of $12.6 million, representing the repurchase of these notes at a discount, partially offset by tender premiums and redemption fees.
Accounts Receivable Purchase Agreements
We are party to master receivables purchase agreements, under which we may sell available and eligible outstanding customer accounts receivable generated by sales to certain customers of up to approximately $247 million at any one time. The agreements are uncommitted and can be terminated by us or the purchaser upon notice in accordance with the terms of the
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
agreements. Transactions under these agreements are accounted for as sales of accounts receivable, and the receivables sold are removed from the consolidated balance sheets as of the effective time of the sales transaction. During the three-month period ended March 31, 2026, the Company sold and removed approximately $235.3 million of accounts receivable under the master receivables purchase agreements. The Company incurred approximately $1.6 million of fees associated with the master receivables purchase agreements during the three-month period ended March 31, 2026. Costs associated with the sales of receivables are reflected in the consolidated statements of income for the period in which the sales occur.
NOTE 7—Deferred Revenue:
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.
Deferred revenue at March 31, 2026 and December 31, 2025 consisted of the following (in thousands):
| March 31, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| Current deferred revenue(a) | $ | 91,749 | $ | 93,090 | |||||||
| Noncurrent deferred revenue(b) | 318,652 | 340,527 | |||||||||
| Total deferred revenue | $ | 410,401 | $ | 433,617 |
(a) Reported in Accrued expenses on the consolidated balance sheets.
(b) Reported in Other noncurrent liabilities on the consolidated balance sheets.
During the year ended December 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. Deferred revenue of $21.9 million was recognized in Net sales during the three-month period ended March 31, 2026. There was no deferred revenue recognized in Net sales during the three-month period ended March 31, 2025.
NOTE 8—Commitments and Contingencies:
Environmental
The following activity was recorded in environmental liabilities for the three months ended March 31, 2026 (in thousands):
| Beginning balance at December 31, 2025 | $ | 20,548 | |||
| Expenditures | (103) | ||||
| Accretion of discount | 224 | ||||
| Foreign currency translation adjustments and other | (69) | ||||
| Ending balance at March 31, 2026 | 20,600 | ||||
| Less amounts reported in Accrued expenses | 4,183 | ||||
| Amounts reported in Other noncurrent liabilities | $ | 16,417 |
Environmental remediation liabilities included discounted liabilities of $17.1 million and $17.0 million at March 31, 2026 and December 31, 2025, respectively, discounted at rates with a weighted-average of 4.0%, and with the undiscounted amount totaling $34.1 million and $34.2 million at March 31, 2026 and December 31, 2025, 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 a 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.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
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.
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 that 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 that 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 $21.7 million and $12.1 million at March 31, 2026 and December 31, 2025, 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 2016 and the Refining Solutions Business Transaction in March 2026.
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, 2026, the Company believes its liability under such obligations is immaterial.
NOTE 9—Equity:
Common Stock
On February 26, 2026, the Company’s board of directors declared a cash dividend of $0.405 per share. This dividend was paid on April 1, 2026 to shareholders of record at the close of business as of March 13, 2026. On May 5, 2026, the Company’s board of directors declared a cash dividend of $0.405 per share, which is payable on July 1, 2026 to shareholders of record at the close of business as of June 12, 2026.
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.
The Company pays a quarterly cash dividend of $18.125 per share of Mandatory Convertible Preferred Stock. Dividends that are declared on the Mandatory Convertible Preferred Stock are payable quarterly to the holders of record on February 15, May 15, August 15 and November 15 of each year, and 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.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
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 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.
There were 2,300,000 shares of Mandatory Convertible Preferred Stock issued and outstanding at March 31, 2026.
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, 2026 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign Currency Translation and Other**(a)** | Cash Flow Hedge**(b)** | Total | Foreign Currency Translation and Other | Cash Flow Hedge**(b)** | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, beginning of period | $ | (339,519) | $ | 4,712 | $ | (334,807) | $ | (747,202) | $ | 5,140 | $ | (742,062) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) before reclassifications | 26,453 | (110) | 26,343 | 108,999 | (231) | 108,768 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss | 49,314 | 3 | 49,317 | 16 | 124 | 140 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | 75,767 | (107) | 75,660 | 109,015 | (107) | 108,908 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss attributable to noncontrolling interests | 35 | — | 35 | 18 | — | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, end of period | $ | (263,717) | $ | 4,605 | $ | (259,112) | $ | (638,169) | $ | 5,033 | $ | (633,136) |
(a)Amount reclassified from accumulated other comprehensive loss for the three-month period ended March 31, 2026 is primarily included in Loss on sale of business on the consolidated statement of income, and resulted from the release of cumulative foreign currency translation adjustments into earnings upon the sale of the Refining Solutions business on March 2, 2026. See Note 2, “Divestitures,” for additional information.
(b)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 balance of the settled hedged foreign currency forward contracts will be reclassified to earnings over the life of the related assets.
The amount of income tax benefit (expense) allocated to each component of Other comprehensive income for the three-month periods ended March 31, 2026 and 2025 is provided in the following tables (in thousands):
| Three Months Ended March 31, 2026 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign Currency Translation and Other | Cash Flow Hedge | Total | Foreign Currency Translation and Other | Cash Flow Hedge | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), before tax | $ | 75,738 | $ | (107) | $ | 75,631 | $ | 109,018 | $ | (107) | $ | 108,911 | |||||||||||||||||||||||||||||||||||||||||
| Income tax benefit (expense) | 29 | — | 29 | (3) | — | (3) | |||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | $ | 75,767 | $ | (107) | $ | 75,660 | $ | 109,015 | $ | (107) | $ | 108,908 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 10—Restructuring Charges and Asset Write-offs:
Kemerton Train 1 Restructuring
In February 2026, in connection with the Company’s ongoing review of its cost and operating structure, the Company put the Kemerton Train 1 in Western Australia into care and maintenance. As a result, the Company recorded charges in Restructuring charges and asset write-offs for the three-month period ended March 31, 2026 of $24.7 million, consisting of decommissioning costs, asset disposal costs, contract cancellation costs, severance and other associated charges resulting from placing Kemerton Train 1 into care and maintenance (the “Kemerton Train 1 Restructuring”). All charges related to the Kemerton Train 1 Restructuring were recorded in the Energy Storage segment.
In connection with the Kemerton Train 1 Restructuring, the Company expects to record additional charges in the range of $80 million to $100 million, primarily related to decommissioning costs during the remainder of 2026 and 2027, when the actions are expected to be completed.
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 (the “Second Half 2024 Restructuring”). 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. Additionally, as part of this restructuring plan, the Company placed the Chengdu, China conversion plant into care and maintenance during the first half of 2025. Production from the Chengdu site has been transferred to another processing facility in China.
The Company’s actions regarding Kemerton were 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 lowering operating costs, reducing capital intensity and enhancing the Company’s financial flexibility. As part of this overall effort, the Company also implemented a global workforce reduction that impacted 6-7% of total headcount during the second half of 2024.
Since July 2024, the Company has recorded charges for this plan consisting of decommissioning costs of $13.0 million, asset write-offs of $726.0 million, severance and employee benefits of $53.4 million, contract cancellation costs of $38.4 million and other (primarily consisting of the reclassification of the related dedesignated cash flow hedge from Accumulated other comprehensive loss) of $29.3 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 finalize placing Kemerton Train 2 into care and maintenance during the first half of 2026.
Detail of Restructuring Charges and Liabilities
The following table provides details of our restructuring related charges recorded to Restructuring charges and asset write-offs on the consolidated statements of income (with the exception of dedesignated cash flow hedge charges recorded in Other income, net) for the three-month periods ended March 31, 2026 and 2025 (in thousands):
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||
| Decommissioning Costs**(a)** | Asset Write-offs**(b)** | Severance and Employee Benefits | Contract Cancellation Costs**(c)** | Other**(d)** | Total | ||||||||||||||||||||||||||||||
| Kemerton Train 1 Restructuring | $ | 4,343 | $ | 2,732 | $ | 15,397 | $ | 1,013 | $ | 1,191 | $ | 24,676 | |||||||||||||||||||||||
| Second Half 2024 Restructuring(e) | 1,190 | — | — | — | — | 1,190 | |||||||||||||||||||||||||||||
| $ | 5,533 | $ | 2,732 | $ | 15,397 | $ | 1,013 | $ | 1,191 | $ | 25,866 | ||||||||||||||||||||||||
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||
| Decommissioning Costs**(a)** | Asset Write-offs**(b)** | Severance and Employee Benefits | Contract Cancellation Costs**(c)** | Other**(d)** | Total | ||||||||||||||||||||||||||||||
| Second Half 2024 Restructuring(e) | $ | 5,755 | $ | (7,248) | $ | 1,620 | $ | (1,826) | $ | 866 | $ | (833) | |||||||||||||||||||||||
(a) Decommissioning costs to put Kemerton Trains 1 and 2 and the Chengdu, China conversion plant into care and maintenance.
(b) 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 net favorable adjustment of 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.
(d) Other costs recorded as part of the Kemerton Train 1 Restructuring plan were primarily related to the disposal of assets. Other costs recorded during the three-month period ended March 31, 2025 with respect to the Second Half 2024 Restructuring include $0.2 million recorded in Other income, net.
(e) Severance and employee benefits related to all segments, as well as Corporate and all other. All other restructuring costs were primarily recorded in the Energy Storage segment.
The following tables summarize the changes in restructuring liabilities for the three-month period ended March 31, 2026 (in thousands):
| Kemerton Train 1 Restructuring | Decommissioning Costs | Asset Write-offs | Severance and Employee Benefits | Contract Cancellation Costs | Other | Total | |||||||||||||||||||||||||||||
| Beginning balance at December 31, 2025 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
| 2026 charges | 4,343 | 2,732 | 15,397 | 1,013 | 1,191 | 24,676 | |||||||||||||||||||||||||||||
| Cash payments | (4,343) | — | (6,023) | — | (152) | (10,518) | |||||||||||||||||||||||||||||
| Asset write-off | — | (2,612) | — | — | — | (2,612) | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | (228) | — | — | (228) | |||||||||||||||||||||||||||||
| Ending balance at March 31, 2026(a) | $ | — | $ | 120 | $ | 9,146 | $ | 1,013 | $ | 1,039 | $ | 11,318 | |||||||||||||||||||||||
| Second Half 2024 Restructuring | Decommissioning Costs | Asset Write-offs | Severance and Employee Benefits | Contract Cancellation Costs | Other | Total | |||||||||||||||||||||||||||||
| Beginning balance at December 31, 2025 | $ | — | $ | — | $ | 1,115 | $ | 16,158 | $ | 4,843 | $ | 22,116 | |||||||||||||||||||||||
| 2026 charges | 1,190 | — | — | — | — | 1,190 | |||||||||||||||||||||||||||||
| Cash payments | (1,190) | — | (828) | — | — | (2,018) | |||||||||||||||||||||||||||||
| Foreign currency translation adjustments and other | — | — | (189) | — | — | (189) | |||||||||||||||||||||||||||||
| Ending balance at March 31, 2026(a) | $ | — | $ | — | $ | 98 | $ | 16,158 | $ | 4,843 | $ | 21,099 |
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
(a) Approximately $22.2 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, 2026. $10.2 million of the liability is recorded in Other noncurrent liabilities as of March 31, 2026, and relates to certain take or pay liabilities that will be paid in line with the terms of the original contract through 2027 and severance liabilities that are expected to be paid beyond the next twelve months.
NOTE 11—Pension Plans and Other Postretirement Benefits:
The components of pension and postretirement benefits cost (credit) for the three-month periods ended March 31, 2026 and 2025 were as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Pension Benefits Cost (Credit): | |||||||||||||||||||||||
| Service cost | $ | 1,550 | $ | 1,397 | |||||||||||||||||||
| Interest cost | 8,412 | 8,339 | |||||||||||||||||||||
| Expected return on assets | (7,694) | (8,535) | |||||||||||||||||||||
| Amortization of prior service benefit | 20 | 19 | |||||||||||||||||||||
| Total net pension benefits cost | $ | 2,288 | $ | 1,220 | |||||||||||||||||||
| Postretirement Benefits Cost: | |||||||||||||||||||||||
| Service cost | $ | 4 | $ | 5 | |||||||||||||||||||
| Interest cost | 629 | 471 | |||||||||||||||||||||
| Total net postretirement benefits cost | $ | 633 | $ | 476 | |||||||||||||||||||
| Total net pension and postretirement benefits cost | $ | 2,921 | $ | 1,696 |
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, 2026 and 2025, the Company made contributions of $3.2 million and $5.2 million, respectively, to its qualified and nonqualified plans and the U.S. postretirement benefit plan. We expect contributions to our domestic nonqualified and foreign qualified and nonqualified pension plans to be approximately $19.1 million in 2026.
NOTE 12—Income Taxes:
The effective income tax rate for the three-month period ended March 31, 2026 was 8.5% compared to 21.0% for the three-month period ended March 31, 2025. The Company’s effective income tax rate fluctuates based on, among other factors, the amount and location of income. The change in effective tax rate in the three-month period ended March 31, 2026, compared to the three-month period ended March 31, 2025, was due to the impact of 2026 earnings in various jurisdictions, including the impact of valuation allowances. 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, 2026 was 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 U.S. entities, Australian entities and certain entities in China. The Company’s effective income tax rate for the three-month period 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 our consolidated Australian entities and certain entities in China, and an uncertain tax position recorded in Chile.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 13—Earnings Per Share:
Basic and diluted loss per share for the three-month periods ended March 31, 2026 and 2025 are calculated as follows (in thousands, except per share amounts):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Basic earnings (loss) per share | |||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 319,091 | $ | 41,348 | |||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (41,688) | |||||||||||||||||||||
| Net income (loss) attributable to Albemarle Corporation common shareholders | $ | 277,403 | $ | (340) | |||||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted-average common shares for basic earnings (loss) per share | 117,854 | 117,603 | |||||||||||||||||||||
| Basic earnings (loss) per share | $ | 2.35 | $ | (0.00) | |||||||||||||||||||
| Diluted earnings (loss) per share | |||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 319,091 | $ | 41,348 | |||||||||||||||||||
| Mandatory convertible preferred stock dividends | (41,688) | (41,688) | |||||||||||||||||||||
| Net income (loss) attributable to Albemarle Corporation common shareholders | $ | 277,403 | $ | (340) | |||||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted-average common shares for basic earnings (loss) per share | 117,854 | 117,603 | |||||||||||||||||||||
| Incremental shares under stock compensation plans | 753 | — | |||||||||||||||||||||
| Weighted-average common shares for diluted earnings (loss) per share | 118,607 | 117,603 | |||||||||||||||||||||
| Diluted earnings (loss) per share | $ | 2.34 | $ | (0.00) |
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, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Shares assuming the conversion of the mandatory convertible preferred stock | 17,521 | 21,022 | |||||||||||||||||||||
| Shares under the stock compensation plans | 97 | 1,161 |
NOTE 14—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.
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.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
The following table provides details of our lease contracts for the three-month periods ended March 31, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Operating lease cost | $ | 9,676 | $ | 8,732 | |||||||||||||||||||
| Finance lease cost: | |||||||||||||||||||||||
| Amortization of right of use assets | 1,609 | 1,998 | |||||||||||||||||||||
| Interest on lease liabilities | 1,526 | 1,619 | |||||||||||||||||||||
| Total finance lease cost | 3,135 | 3,617 | |||||||||||||||||||||
| Short-term lease cost | 5,354 | 6,166 | |||||||||||||||||||||
| Variable lease cost | 12,979 | 8,416 | |||||||||||||||||||||
| Total lease cost | $ | 31,144 | $ | 26,931 |
Supplemental cash flow information related to our lease contracts for the three-month periods ended March 31, 2026 and 2025 is as follows (in thousands):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
| Operating cash flows from operating leases | $ | 9,381 | $ | 8,386 | |||||||
| Operating cash flows from finance leases | 1,526 | 1,615 | |||||||||
| Financing cash flows from finance leases | 1,237 | 1,195 | |||||||||
| Right-of-use assets obtained in exchange for lease obligations: | |||||||||||
| Operating leases | 4,589 | 9,896 | |||||||||
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, 2026 and December 31, 2025 is as follows (in thousands, except as noted):
| March 31, 2026 | December 31, 2025 | ||||||||||
| Operating leases: | |||||||||||
| Other assets | $ | 112,937 | $ | 116,404 | |||||||
| Accrued expenses | 23,824 | 24,561 | |||||||||
| Other noncurrent liabilities | 100,336 | 103,110 | |||||||||
| Total operating lease liabilities | 124,160 | 127,671 | |||||||||
| Finance leases: | |||||||||||
| Net property, plant and equipment | 102,659 | 103,915 | |||||||||
| Current portion of long-term debt | 4,128 | 4,077 | |||||||||
| Long-term debt | 101,695 | 102,719 | |||||||||
| Total finance lease liabilities | 105,823 | 106,796 | |||||||||
| Weighted average remaining lease term (in years): | |||||||||||
| Operating leases | 13.5 | 13.4 | |||||||||
| Finance leases | 20.3 | 20.5 | |||||||||
| Weighted average discount rate (%): | |||||||||||
| Operating leases | 4.99 | % | 5.01 | % | |||||||
| Finance leases | 5.47 | % | 5.47 | % |
Maturities of lease liabilities at March 31, 2026 were as follows (in thousands):
| Operating Leases | Finance Leases | ||||||||||
| Remainder of 2026 | $ | 21,146 | $ | 7,394 | |||||||
| 2027 | 24,731 | 9,790 | |||||||||
| 2028 | 20,576 | 9,652 | |||||||||
| 2029 | 18,003 | 9,652 | |||||||||
| 2030 | 12,857 | 9,004 | |||||||||
| Thereafter | 100,854 | 122,870 | |||||||||
| Total lease payments | 198,167 | 168,362 | |||||||||
| Less imputed interest | 74,007 | 62,539 | |||||||||
| Total | $ | 124,160 | $ | 105,823 |
NOTE 15—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, 2026 | December 31, 2025 | ||||||||||||||||||||||
| Recorded Amount | Fair Value | Recorded Amount | Fair Value | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Long-term debt | $ | 1,888,986 | $ | 1,818,749 | $ | 3,207,210 | $ | 3,112,590 |
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, 2026 and December 31, 2025, we had outstanding non-designated derivative financial instruments with notional values totaling $1.6 billion and $2.4 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, 2026, 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, 2026 and December 31, 2025 (in thousands):
| March 31, 2026 | December 31, 2025 | ||||||||||||||||||||||
| Assets | Liabilities | Assets | Liabilities | ||||||||||||||||||||
| Not designated as hedging instruments | |||||||||||||||||||||||
| Other current assets | $ | — | $ | — | $ | 2,163 | $ | — | |||||||||||||||
| Accrued expenses | — | 7,888 | — | 4,781 | |||||||||||||||||||
| Total not designated as hedging instruments | $ | — | $ | 7,888 | $ | 2,163 | $ | 4,781 | |||||||||||||||
The following table summarizes the net (losses) gains recognized for our derivative financial instruments during the three-month periods ended March 31, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Not designated as hedging instruments | |||||||||||||||||||||||
| (Loss) gain recognized in Other income, net(a) | $ | (15,784) | $ | 52,078 |
(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, 2026 and 2025, we recorded net cash (settlements) receipts of ($10.5) million and $50.3 million, respectively, in (Payments) proceeds from settlement of foreign currency forward contracts, net, in our condensed consolidated statements of cash flows.
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 16—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:
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| 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, 2026 and December 31, 2025 (in thousands):
| March 31, 2026 | 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: | |||||||||||||||||||||||
| Investments under executive deferred compensation plan(a) | $ | 29,712 | $ | 29,712 | $ | — | $ | — | |||||||||||||||
| Public equity securities(b) | $ | 23,560 | $ | 23,560 | $ | — | $ | — | |||||||||||||||
| Private equity securities measured at net asset value(c) | $ | 4,524 | $ | — | $ | — | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Obligations under executive deferred compensation plan(a) | $ | 29,712 | $ | 29,712 | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(d) | $ | 7,888 | $ | — | $ | 7,888 | $ | — |
| December 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: | |||||||||||||||||||||||
| Investments under executive deferred compensation plan(a) | $ | 30,750 | $ | 30,750 | $ | — | $ | — | |||||||||||||||
| Public equity securities(b) | $ | 29,047 | $ | 29,047 | $ | — | $ | — | |||||||||||||||
| Private equity securities measured at net asset value(c) | $ | 4,515 | $ | — | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(d) | $ | 2,163 | $ | — | $ | 2,163 | $ | — | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Obligations under executive deferred compensation plan(a) | $ | 30,750 | $ | 30,750 | $ | — | $ | — | |||||||||||||||
| Derivative financial instruments(d) | $ | 4,781 | $ | — | $ | 4,781 | $ | — |
(a)We have maintained an Executive Deferred Compensation Plan (“EDCP”) since 2001. 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.
(b)Holdings in equity securities of public companies is 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 4, “Investments,” for further details.
(c)The Company’s private equity security investments 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. Private equity securities are reported in Investments in the consolidated balance sheets and changes in fair value are reported in Other income, net in the consolidated statements of income.
(d)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
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
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 15, “Fair Value of Financial Instruments,” for further details about our foreign currency forward contracts.
NOTE 17—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, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Sales to unconsolidated affiliates | $ | — | $ | 1,536 | |||||||||||||||||||
| Purchases from unconsolidated affiliates(a) | $ | 281,950 | $ | 159,206 |
(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, 2026 | December 31, 2025 | ||||||||||
| Receivables from unconsolidated affiliates | $ | — | $ | 2,643 | |||||||
| Payables to unconsolidated affiliates(a) | $ | 256,630 | $ | 134,369 |
(a)Payables to unconsolidated affiliates primarily relate to spodumene purchased from the Company’s Windfield joint venture under normal payment terms.
Following the divestiture of the controlling ownership interest of the Refining Solutions business in the first quarter of 2026, the Company no longer transacts with, or has balances outstanding with, the joint ventures previously reported in the Ketjen segment. See Note 2, “Divestitures,” for additional information about the divestiture.
NOTE 18—Segment Information:
Following the completion of the sale of our Refining Solutions business discussed in Note 2, “Divestitures,” the Company has two reportable segments: (1) Energy Storage and (2) Specialties. 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 and All Other category is not considered to be a segment and includes corporate-related items not allocated to the operating segments, as well as the results of the PCS business and the ownership interest in the Ketjen joint venture, as they do not fit into any of our core businesses. 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,
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
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. Prior period amounts have been recast to reflect the current segment structure.
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 and three-month periods ended March 31, 2026 and 2025 (in thousands):
| Energy Storage | Specialties | Total Segments | |||||||||||||||||||||
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||
| Net sales(a) | $ | 891,165 | $ | 358,413 | $ | 1,249,578 | |||||||||||||||||
| Cost of goods sold(b) | (409,704) | (242,790) | (652,494) | ||||||||||||||||||||
| Selling, general and administrative expenses(b) | (49,281) | (27,061) | (76,342) | ||||||||||||||||||||
| Other segment items(c) | (901) | (2,547) | (3,448) | ||||||||||||||||||||
| Equity in net income of unconsolidated investments(d) | 120,077 | — | 120,077 | ||||||||||||||||||||
| Net income attributable to noncontrolling interests | — | (9,886) | (9,886) | ||||||||||||||||||||
| Adjusted EBITDA by segment | $ | 551,356 | $ | 76,129 | $ | 627,485 | |||||||||||||||||
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||
| Net sales(a) | $ | 524,565 | $ | 321,014 | $ | 845,579 | |||||||||||||||||
| Cost of goods sold(b) | (365,521) | (231,226) | (596,747) | ||||||||||||||||||||
| Selling, general and administrative expenses(b) | (44,535) | (20,379) | (64,914) | ||||||||||||||||||||
| Other segment items(c) | (2,550) | (2,793) | (5,343) | ||||||||||||||||||||
| Equity in net income of unconsolidated investments(d) | 74,396 | — | 74,396 | ||||||||||||||||||||
| Net income attributable to noncontrolling interests | — | (7,950) | (7,950) | ||||||||||||||||||||
| Adjusted EBITDA by segment | $ | 186,355 | $ | 58,666 | $ | 245,021 |
(a)Intersegment sales are not considered material. See below for reconciliation of reportable segment net sales to total Albemarle net sales.
(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):
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Total segment adjusted EBITDA | $ | 627,485 | $ | 245,021 | |||||||||||||||||||
| Corporate and all other adjusted EBITDA | 36,329 | 22,123 | |||||||||||||||||||||
| Depreciation and amortization | (157,805) | (161,754) | |||||||||||||||||||||
| Interest and financing expenses(a) | (33,121) | (48,977) | |||||||||||||||||||||
| Income tax (expense) benefit | (21,511) | 3,978 | |||||||||||||||||||||
| Proportionate share of Windfield income tax expense(b) | (41,534) | (25,326) | |||||||||||||||||||||
| Loss on sale of business/equity investment, net(c) | (52,718) | — | |||||||||||||||||||||
| Acquisition and integration related costs(d) | (1,107) | (1,440) | |||||||||||||||||||||
| Restructuring charges and asset write-offs(e) | (25,866) | 833 | |||||||||||||||||||||
| Non-operating pension and OPEB items | (1,347) | (275) | |||||||||||||||||||||
| Loss in fair value of public equity securities(f) | (5,487) | (5,022) | |||||||||||||||||||||
| Other(g) | (4,227) | 12,187 | |||||||||||||||||||||
| Net income attributable to Albemarle Corporation | $ | 319,091 | $ | 41,348 |
(a)Includes a gain on early extinguishment of debt of $12.6 million for the three months ended March 31, 2026. See Note 6, “Long-Term Debt,” for further details.
(b)Albemarle’s 49% ownership interest in the reported income tax expense of the Windfield joint venture.
(c)Loss on sale of controlling ownership interest in Refining Solutions business included in Loss on sale of business on the consolidated statement of income. Partially offset by gain on sale of Eurecat S.A. joint venture recorded in Other income, net. See Note 2, “Divestitures,” for further details.
(d)Costs related to the acquisition, integration and divestitures for various significant projects, recorded in Selling, general and administrative expenses (“SG&A”).
(e)See Note 10, “Restructuring Charges and Asset Write-offs,” for further details.
(f)Represents the net change in fair value of investments in public equity securities for the three-month periods ended March 31, 2026 and 2025, recorded in Other income, net.
(g)Included amounts for the three months ended March 31, 2026 recorded in:
- SG&A - Primarily related to a $3.9 million charge for a non-income tax audit of a facility no longer controlled by the Company.
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 W.R. Grace & Co. 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.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
Total assets and investments in equity method investees by segment at March 31, 2026 and December 31, 2025 were as follows (in thousands):
| March 31, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| Assets: | |||||||||||
| Energy Storage | $ | 11,304,071 | $ | 11,086,694 | |||||||
| Specialties | 2,004,561 | 2,067,191 | |||||||||
| Total segment assets | 13,308,632 | 13,153,885 | |||||||||
| Corporate and all other | 1,830,946 | 3,220,326 | |||||||||
| Total assets | $ | 15,139,578 | $ | 16,374,211 | |||||||
| Investments in equity method investees: | |||||||||||
| Energy Storage | $ | 894,971 | $ | 737,792 | |||||||
| Total segment investments in equity method investees | 894,971 | 737,792 | |||||||||
| Corporate and all other | 53,115 | 82,056 | |||||||||
| Total investments in equity method investees | $ | 948,086 | $ | 819,848 |
Additional segment information for the three-month periods ended March 31, 2026 and 2025 was as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net sales: | |||||||||||||||||||||||
| Energy Storage | $ | 891,165 | $ | 524,565 | |||||||||||||||||||
| Specialties | 358,413 | 321,014 | |||||||||||||||||||||
| Total segment net sales | 1,249,578 | 845,579 | |||||||||||||||||||||
| Corporate and all other | 179,153 | 231,302 | |||||||||||||||||||||
| Total net sales | $ | 1,428,731 | $ | 1,076,881 | |||||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||||||||
| Energy Storage | $ | 124,350 | $ | 120,348 | |||||||||||||||||||
| Specialties | 28,691 | 25,733 | |||||||||||||||||||||
| Total segment depreciation and amortization | 153,041 | 146,081 | |||||||||||||||||||||
| Corporate and all other | 4,764 | 15,673 | |||||||||||||||||||||
| Total depreciation and amortization | $ | 157,805 | $ | 161,754 | |||||||||||||||||||
| Equity in net income of unconsolidated investments (net of tax): | |||||||||||||||||||||||
| Energy Storage | $ | 82,967 | $ | 50,845 | |||||||||||||||||||
| Total segment equity in net income of unconsolidated investments (net of tax) | 82,967 | 50,845 | |||||||||||||||||||||
| Corporate and all other(a) | 13,326 | 13,441 | |||||||||||||||||||||
| Total equity in net income of unconsolidated investments (net of tax) | $ | 96,293 | $ | 64,286 | |||||||||||||||||||
| Capital expenditures: | |||||||||||||||||||||||
| Energy Storage | $ | 54,121 | $ | 94,443 | |||||||||||||||||||
| Specialties | 20,418 | 62,225 | |||||||||||||||||||||
| Total segment capital expenditures | 74,539 | 156,668 | |||||||||||||||||||||
| Corporate and all other | 24,137 | 25,956 | |||||||||||||||||||||
| Total capital expenditures | $ | 98,676 | $ | 182,624 |
(a)Corporate and all other equity in net income of unconsolidated investments (net of tax) relates to foreign exchange gains or losses from the Windfield joint venture and our 49% ownership interest in the Ketjen joint venture.
ALBEMARLE CORPORATION AND SUBSIDIARIES
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 19—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, | |||||||||||
| 2026 | 2025 | ||||||||||
| Supplemental non-cash disclosure related to investing and financing activities: | |||||||||||
| Capital expenditures included in Accounts payable | $ | 78,213 | $ | 127,369 | |||||||
| Non-cash investments in equity investments(a) | $ | 53,000 | $ | — |
(a)Represents the Company’s investment in the Ketjen unconsolidated joint venture following the completion of the sale of our Refining Solutions business during the three-month period ended March 31, 2026. See Note 2, “Divestitures,” for further details regarding the sale of the Company’s Refining Solutions business.
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 7, “Deferred Revenue,” for further details.
NOTE 20—Recently Issued or Adopted Accounting Pronouncements:
In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” 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.
In December 2025, the FASB issued ASU 2025-10, “Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities,” on the recognition, measurement and presentation of government grants received by business entities and amends certain existing disclosure requirements in ASC 832, Government Assistance. This guidance is effective for fiscal years beginning after December 15, 2028, and interim periods within those fiscal years. As allowed by its provisions, the Company early-adopted this guidance in the fourth quarter of 2025 and applied the amendments on a modified prospective basis. The adoption of this guidance does not have a significant impact on our condensed consolidated financial statements.
Previous: Cover and table of contents · Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.