Amid lower lithium prices, Albemarle has delivered a mix bag of results for the March 2024 quarter.
The lithium giant delivered $1.4 billion in net sales, a 47 per cent decline from the previous quarter’s $2.6 billion. The decline was credited to lower pricing in Albemarle’s energy storage business.
This resulted in energy storage net sales equalling $801 million, a $1.1 billion decrease which offset higher volumes related to the ramp of lithium projects, including the La Negra III/IV expansion in Chile and the processing plant in Qinzhou, China, and sales of chemical-grade spodumene.
Albemarle also recorded a net income of $2 million and $291 million in adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA). From the prior quarter, Albemarle’s net income decreased by $1.2 billion and its adjusted EBITDA by $1.5 billion.
The company said the decline in earnings was primarily due to the lithium downturn and additional margin compression due to inventory timing and reduced equity earnings at the Talison joint venture it shares with IGO and Tianqi Lithium, which also offset favourable volumes.
However, it wasn’t all doom and gloom for Albemarle.
The company remains on track to deliver more than $280 million in productivity benefits in 2024, with over $90 million delivered in the March quarter.
Successful bidding events for spodumene concentrate and lithium carbonate designed to promote price transparency and discovery were also conducted, and the Kemerton lithium hydroxide processing plant achieved a 50 per cent operating rate.
“In the first quarter, our team demonstrated agility in dynamic market conditions by continuing to deliver solid volumetric growth, ramping new conversion facilities, and executing cost reduction and productivity improvements,” Albemarle chairman and chief executive officer Kent Masters said.
“We have strengthened our competitive position, enhanced our financial flexibility, and started to increase lithium market price transparency. Our actions best position us to serve our core end-markets today and for the future.
“We remain focused on disciplined capital allocation to deliver profitable organic growth and value for all stakeholders.”
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