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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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VIRGINIA
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54-1692118
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
|
|
|
|
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4350 CONGRESS STREET, SUITE 700
CHARLOTTE, NORTH CAROLINA
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28209
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
|
|
x
|
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Accelerated filer
|
|
¨
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Non-accelerated filer
|
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Page
Number(s)
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8-27
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27-45
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||
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|
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EXHIBITS
|
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|
|
Item 1.
|
Financial Statements (Unaudited).
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net sales
|
$
|
777,748
|
|
|
$
|
754,866
|
|
|
$
|
2,453,251
|
|
|
$
|
2,214,187
|
|
|
Cost of goods sold
|
497,211
|
|
|
479,210
|
|
|
1,556,379
|
|
|
1,411,614
|
|
||||
|
Gross profit
|
280,537
|
|
|
275,656
|
|
|
896,872
|
|
|
802,573
|
|
||||
|
Selling, general and administrative expenses
|
100,167
|
|
|
106,471
|
|
|
325,174
|
|
|
331,984
|
|
||||
|
Research and development expenses
|
16,610
|
|
|
21,763
|
|
|
53,670
|
|
|
63,423
|
|
||||
|
Gain on sale of business
|
—
|
|
|
—
|
|
|
(218,705
|
)
|
|
—
|
|
||||
|
Operating profit
|
163,760
|
|
|
147,422
|
|
|
736,733
|
|
|
407,166
|
|
||||
|
Interest and financing expenses
|
(12,988
|
)
|
|
(15,792
|
)
|
|
(39,834
|
)
|
|
(98,895
|
)
|
||||
|
Other income (expenses), net
|
3,793
|
|
|
(1,986
|
)
|
|
(31,906
|
)
|
|
(3,399
|
)
|
||||
|
Income before income taxes and equity in net income of unconsolidated investments
|
154,565
|
|
|
129,644
|
|
|
664,993
|
|
|
304,872
|
|
||||
|
Income tax expense
|
33,167
|
|
|
18,495
|
|
|
133,630
|
|
|
53,596
|
|
||||
|
Income before equity in net income of unconsolidated investments
|
121,398
|
|
|
111,149
|
|
|
531,363
|
|
|
251,276
|
|
||||
|
Equity in net income of unconsolidated investments (net of tax)
|
22,081
|
|
|
19,044
|
|
|
61,727
|
|
|
55,263
|
|
||||
|
Net income
|
143,479
|
|
|
130,193
|
|
|
593,090
|
|
|
306,539
|
|
||||
|
Net income attributable to noncontrolling interests
|
(13,734
|
)
|
|
(11,523
|
)
|
|
(29,124
|
)
|
|
(33,323
|
)
|
||||
|
Net income attributable to Albemarle Corporation
|
$
|
129,745
|
|
|
$
|
118,670
|
|
|
$
|
563,966
|
|
|
$
|
273,216
|
|
|
Basic earnings per share
|
$
|
1.21
|
|
|
$
|
1.07
|
|
|
$
|
5.16
|
|
|
$
|
2.46
|
|
|
Diluted earnings per share
|
$
|
1.20
|
|
|
$
|
1.06
|
|
|
$
|
5.11
|
|
|
$
|
2.43
|
|
|
Weighted-average common shares outstanding – basic
|
107,315
|
|
|
110,476
|
|
|
109,223
|
|
|
111,049
|
|
||||
|
Weighted-average common shares outstanding – diluted
|
108,302
|
|
|
111,975
|
|
|
110,276
|
|
|
112,456
|
|
||||
|
Cash dividends declared per share of common stock
|
$
|
0.335
|
|
|
$
|
0.32
|
|
|
$
|
1.005
|
|
|
$
|
0.96
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Net income
|
$
|
143,479
|
|
|
$
|
130,193
|
|
|
$
|
593,090
|
|
|
$
|
306,539
|
|
|
Other comprehensive (loss) income, net of tax:
|
|
|
|
|
|
|
|
||||||||
|
Foreign currency translation
|
(9,549
|
)
|
|
56,179
|
|
|
(95,515
|
)
|
|
199,303
|
|
||||
|
Pension and postretirement benefits
|
11
|
|
|
(7
|
)
|
|
37
|
|
|
2
|
|
||||
|
Net investment hedge
|
(3,621
|
)
|
|
(9,681
|
)
|
|
4,947
|
|
|
(37,600
|
)
|
||||
|
Interest rate swap
|
642
|
|
|
529
|
|
|
1,926
|
|
|
1,587
|
|
||||
|
Total other comprehensive (loss) income, net of tax
|
(12,517
|
)
|
|
47,020
|
|
|
(88,605
|
)
|
|
163,292
|
|
||||
|
Comprehensive income
|
130,962
|
|
|
177,213
|
|
|
504,485
|
|
|
469,831
|
|
||||
|
Comprehensive income attributable to noncontrolling interests
|
(13,729
|
)
|
|
(11,653
|
)
|
|
(29,042
|
)
|
|
(34,146
|
)
|
||||
|
Comprehensive income attributable to Albemarle Corporation
|
$
|
117,233
|
|
|
$
|
165,560
|
|
|
$
|
475,443
|
|
|
$
|
435,685
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
|
Assets
|
|
|
|
||||
|
Current assets:
|
|
|
|
||||
|
Cash and cash equivalents
|
$
|
641,226
|
|
|
$
|
1,137,303
|
|
|
Trade accounts receivable, less allowance for doubtful accounts (2018 – $6,300; 2017 – $10,425)
|
550,788
|
|
|
534,326
|
|
||
|
Other accounts receivable
|
41,961
|
|
|
37,937
|
|
||
|
Inventories
|
727,381
|
|
|
592,781
|
|
||
|
Other current assets
|
98,221
|
|
|
136,064
|
|
||
|
Assets held for sale
|
—
|
|
|
39,152
|
|
||
|
Total current assets
|
2,059,577
|
|
|
2,477,563
|
|
||
|
Property, plant and equipment, at cost
|
4,571,779
|
|
|
4,124,335
|
|
||
|
Less accumulated depreciation and amortization
|
1,746,414
|
|
|
1,631,025
|
|
||
|
Net property, plant and equipment
|
2,825,365
|
|
|
2,493,310
|
|
||
|
Investments
|
535,292
|
|
|
534,064
|
|
||
|
Noncurrent assets held for sale
|
—
|
|
|
139,813
|
|
||
|
Other assets
|
78,054
|
|
|
74,164
|
|
||
|
Goodwill
|
1,590,906
|
|
|
1,610,355
|
|
||
|
Other intangibles, net of amortization
|
398,001
|
|
|
421,503
|
|
||
|
Total assets
|
$
|
7,487,195
|
|
|
$
|
7,750,772
|
|
|
Liabilities And Equity
|
|
|
|
||||
|
Current liabilities:
|
|
|
|
||||
|
Accounts payable
|
$
|
474,229
|
|
|
$
|
418,537
|
|
|
Accrued expenses
|
258,371
|
|
|
268,336
|
|
||
|
Current portion of long-term debt
|
286,188
|
|
|
422,012
|
|
||
|
Dividends payable
|
35,462
|
|
|
35,165
|
|
||
|
Liabilities held for sale
|
—
|
|
|
1,938
|
|
||
|
Income taxes payable
|
72,759
|
|
|
54,937
|
|
||
|
Total current liabilities
|
1,127,009
|
|
|
1,200,925
|
|
||
|
Long-term debt
|
1,411,605
|
|
|
1,415,360
|
|
||
|
Postretirement benefits
|
51,669
|
|
|
52,003
|
|
||
|
Pension benefits
|
278,682
|
|
|
294,611
|
|
||
|
Noncurrent liabilities held for sale
|
—
|
|
|
614
|
|
||
|
Other noncurrent liabilities
|
553,469
|
|
|
599,174
|
|
||
|
Deferred income taxes
|
378,484
|
|
|
370,389
|
|
||
|
Commitments and contingencies (Note 9)
|
|
|
|
||||
|
Equity:
|
|
|
|
||||
|
Albemarle Corporation shareholders’ equity:
|
|
|
|
||||
|
Common stock, $.01 par value, issued and outstanding – 106,187 in 2018 and 110,547 in 2017
|
1,062
|
|
|
1,105
|
|
||
|
Additional paid-in capital
|
1,363,262
|
|
|
1,863,949
|
|
||
|
Accumulated other comprehensive loss
|
(314,191
|
)
|
|
(225,668
|
)
|
||
|
Retained earnings
|
2,478,711
|
|
|
2,035,163
|
|
||
|
Total Albemarle Corporation shareholders’ equity
|
3,528,844
|
|
|
3,674,549
|
|
||
|
Noncontrolling interests
|
157,433
|
|
|
143,147
|
|
||
|
Total equity
|
3,686,277
|
|
|
3,817,696
|
|
||
|
Total liabilities and equity
|
$
|
7,487,195
|
|
|
$
|
7,750,772
|
|
|
(In Thousands, Except Share Data)
|
|
|
|
|
|
Additional
Paid-in Capital
|
|
Accumulated Other
Comprehensive (Loss) Income
|
|
Retained Earnings
|
|
Total Albemarle
Shareholders’ Equity
|
|
Noncontrolling
Interests
|
|
Total Equity
|
|||||||||||||||
|
Common Stock
|
|
||||||||||||||||||||||||||||||
|
|
Shares
|
|
Amounts
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Balance at January 1, 2018
|
|
110,546,674
|
|
|
$
|
1,105
|
|
|
$
|
1,863,949
|
|
|
$
|
(225,668
|
)
|
|
$
|
2,035,163
|
|
|
$
|
3,674,549
|
|
|
$
|
143,147
|
|
|
$
|
3,817,696
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
563,966
|
|
|
563,966
|
|
|
29,124
|
|
|
593,090
|
|
|||||||||||
|
Other comprehensive loss
|
|
|
|
|
|
|
|
(88,523
|
)
|
|
|
|
(88,523
|
)
|
|
(82
|
)
|
|
(88,605
|
)
|
|||||||||||
|
Cash dividends declared
|
|
|
|
|
|
|
|
|
|
(109,219
|
)
|
|
(109,219
|
)
|
|
(14,756
|
)
|
|
(123,975
|
)
|
|||||||||||
|
Cumulative adjustment from adoption of income tax standard update (Note 17)
|
|
|
|
|
|
|
|
|
|
(11,199
|
)
|
|
(11,199
|
)
|
|
|
|
(11,199
|
)
|
||||||||||||
|
Stock-based compensation and other
|
|
|
|
|
|
14,015
|
|
|
|
|
|
|
14,015
|
|
|
|
|
14,015
|
|
||||||||||||
|
Exercise of stock options
|
|
71,649
|
|
|
1
|
|
|
2,301
|
|
|
|
|
|
|
2,302
|
|
|
|
|
2,302
|
|
||||||||||
|
Shares repurchased
|
|
(4,665,618
|
)
|
|
(47
|
)
|
|
(499,953
|
)
|
|
|
|
|
|
|
(500,000
|
)
|
|
|
|
(500,000
|
)
|
|||||||||
|
Issuance of common stock, net
|
|
378,006
|
|
|
4
|
|
|
(4
|
)
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||
|
Shares withheld for withholding taxes associated with common stock issuances
|
|
(144,208
|
)
|
|
(1
|
)
|
|
(17,046
|
)
|
|
|
|
|
|
(17,047
|
)
|
|
|
|
(17,047
|
)
|
||||||||||
|
Balance at September 30, 2018
|
|
106,186,503
|
|
|
$
|
1,062
|
|
|
$
|
1,363,262
|
|
|
$
|
(314,191
|
)
|
|
$
|
2,478,711
|
|
|
$
|
3,528,844
|
|
|
$
|
157,433
|
|
|
$
|
3,686,277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
Balance at January 1, 2017
|
|
112,523,790
|
|
|
$
|
1,125
|
|
|
$
|
2,084,418
|
|
|
$
|
(412,412
|
)
|
|
$
|
2,121,931
|
|
|
$
|
3,795,062
|
|
|
$
|
147,542
|
|
|
$
|
3,942,604
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
273,216
|
|
|
273,216
|
|
|
33,323
|
|
|
306,539
|
|
|||||||||||
|
Other comprehensive income
|
|
|
|
|
|
|
|
162,469
|
|
|
|
|
162,469
|
|
|
823
|
|
|
163,292
|
|
|||||||||||
|
Cash dividends declared
|
|
|
|
|
|
|
|
|
|
(106,243
|
)
|
|
(106,243
|
)
|
|
(27,791
|
)
|
|
(134,034
|
)
|
|||||||||||
|
Stock-based compensation and other
|
|
|
|
|
|
12,477
|
|
|
|
|
|
|
12,477
|
|
|
|
|
12,477
|
|
||||||||||||
|
Exercise of stock options
|
|
159,432
|
|
|
2
|
|
|
7,009
|
|
|
|
|
|
|
7,011
|
|
|
|
|
7,011
|
|
||||||||||
|
Shares repurchased
|
|
(2,341,083
|
)
|
|
(23
|
)
|
|
(249,977
|
)
|
|
|
|
|
|
(250,000
|
)
|
|
|
|
(250,000
|
)
|
||||||||||
|
Issuance of common stock, net
|
|
241,755
|
|
|
2
|
|
|
(2
|
)
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||||
|
Termination of Tianqi Lithium Corporation option agreement
|
|
|
|
|
|
13,144
|
|
|
|
|
|
|
13,144
|
|
|
(13,144
|
)
|
|
—
|
|
|||||||||||
|
Shares withheld for withholding taxes associated with common stock issuances
|
|
(89,057
|
)
|
|
(1
|
)
|
|
(8,316
|
)
|
|
|
|
|
|
(8,317
|
)
|
|
|
|
(8,317
|
)
|
||||||||||
|
Balance at September 30, 2017
|
|
110,494,837
|
|
|
$
|
1,105
|
|
|
$
|
1,858,753
|
|
|
$
|
(249,943
|
)
|
|
$
|
2,288,904
|
|
|
$
|
3,898,819
|
|
|
$
|
140,753
|
|
|
$
|
4,039,572
|
|
|
|
Nine Months Ended
September 30, |
||||||
|
|
2018
|
|
2017
|
||||
|
Cash and cash equivalents at beginning of year
|
$
|
1,137,303
|
|
|
$
|
2,269,756
|
|
|
Cash flows from operating activities:
|
|
|
|
||||
|
Net income
|
593,090
|
|
|
306,539
|
|
||
|
Adjustments to reconcile net income to cash flows from operating activities:
|
|
|
|
||||
|
Depreciation and amortization
|
150,511
|
|
|
144,087
|
|
||
|
Gain on acquisition
|
—
|
|
|
(6,025
|
)
|
||
|
Gain on sale of business
|
(218,705
|
)
|
|
—
|
|
||
|
Stock-based compensation
|
11,785
|
|
|
15,595
|
|
||
|
Equity in net income of unconsolidated investments (net of tax)
|
(61,727
|
)
|
|
(55,263
|
)
|
||
|
Dividends received from unconsolidated investments and nonmarketable securities
|
32,794
|
|
|
11,900
|
|
||
|
Pension and postretirement (benefit) expense
|
(2,708
|
)
|
|
67
|
|
||
|
Pension and postretirement contributions
|
(11,068
|
)
|
|
(9,607
|
)
|
||
|
Unrealized gain on investments in marketable securities
|
(1,615
|
)
|
|
(2,007
|
)
|
||
|
Loss on early extinguishment of debt
|
—
|
|
|
52,801
|
|
||
|
Deferred income taxes
|
43,400
|
|
|
4,677
|
|
||
|
Working capital changes
|
(131,813
|
)
|
|
(398,913
|
)
|
||
|
Other, net
|
(27,003
|
)
|
|
10,993
|
|
||
|
Net cash provided by operating activities
|
376,941
|
|
|
74,844
|
|
||
|
Cash flows from investing activities:
|
|
|
|
||||
|
Acquisitions, net of cash acquired
|
(11,403
|
)
|
|
(45,406
|
)
|
||
|
Capital expenditures
|
(471,675
|
)
|
|
(187,519
|
)
|
||
|
Cash proceeds from divestitures, net
|
413,479
|
|
|
6,857
|
|
||
|
(Investments in) sales of marketable securities, net
|
(761
|
)
|
|
450
|
|
||
|
Repayments from joint ventures
|
—
|
|
|
1,250
|
|
||
|
Investments in equity and other corporate investments
|
(5,346
|
)
|
|
—
|
|
||
|
Net cash used in investing activities
|
(75,706
|
)
|
|
(224,368
|
)
|
||
|
Cash flows from financing activities:
|
|
|
|
||||
|
Repayments of long-term debt
|
—
|
|
|
(753,209
|
)
|
||
|
Proceeds from borrowings of long-term debt
|
—
|
|
|
27,000
|
|
||
|
Other (repayments) borrowings, net
|
(134,505
|
)
|
|
79,203
|
|
||
|
Fees related to early extinguishment of debt
|
—
|
|
|
(46,959
|
)
|
||
|
Dividends paid to shareholders
|
(108,922
|
)
|
|
(105,205
|
)
|
||
|
Dividends paid to noncontrolling interests
|
(14,756
|
)
|
|
(27,791
|
)
|
||
|
Repurchases of common stock
|
(500,000
|
)
|
|
(250,000
|
)
|
||
|
Proceeds from exercise of stock options
|
2,302
|
|
|
7,011
|
|
||
|
Withholding taxes paid on stock-based compensation award distributions
|
(17,047
|
)
|
|
(8,317
|
)
|
||
|
Net cash used in financing activities
|
(772,928
|
)
|
|
(1,078,267
|
)
|
||
|
Net effect of foreign exchange on cash and cash equivalents
|
(24,384
|
)
|
|
3,374
|
|
||
|
Decrease in cash and cash equivalents
|
(496,077
|
)
|
|
(1,224,417
|
)
|
||
|
Cash and cash equivalents at end of period
|
$
|
641,226
|
|
|
$
|
1,045,339
|
|
|
•
|
All sales and other pass-through taxes are excluded from contract value;
|
|
•
|
In utilizing the modified retrospective transition method, no adjustment would be necessary for contracts that do not cross over a reporting year;
|
|
•
|
We will not consider the possibility of a contract having a significant financing component (which would effectively attribute a portion of the sales price to interest income) unless, if at contract inception, the expected payment terms (from time of delivery or other relevant criterion) are more than one year;
|
|
•
|
If our right to customer payment is directly related to the value of our completed performance, we recognize revenue consistent with the invoicing right; and
|
|
•
|
We expense as incurred all costs of obtaining a contract incremental to any costs/compensation attributable to individual product sales/shipments for contracts where the amortization period for such costs would otherwise be one year or less.
|
|
|
December 31,
|
||
|
|
2017
|
||
|
Assets
|
|
||
|
Current assets
|
$
|
39,152
|
|
|
Net, property, plant and equipment
|
121,759
|
|
|
|
Goodwill
|
14,422
|
|
|
|
Other intangibles, net of amortization
|
3,632
|
|
|
|
Assets held for sale
|
$
|
178,965
|
|
|
Liabilities
|
|
||
|
Current liabilities
|
$
|
1,938
|
|
|
Noncurrent liabilities
|
614
|
|
|
|
Liabilities held for sale
|
$
|
2,552
|
|
|
|
Lithium
|
|
Bromine Specialties
|
|
Catalysts
|
|
All Other
|
|
Total
|
||||||||||
|
Balance at December 31, 2017
(a)(b)
|
$
|
1,389,089
|
|
|
$
|
20,319
|
|
|
$
|
194,361
|
|
|
$
|
6,586
|
|
|
$
|
1,610,355
|
|
|
Foreign currency translation adjustments and other
|
(15,766
|
)
|
|
—
|
|
|
(3,683
|
)
|
|
—
|
|
|
(19,449
|
)
|
|||||
|
Balance at September 30, 2018
|
$
|
1,373,323
|
|
|
$
|
20,319
|
|
|
$
|
190,678
|
|
|
$
|
6,586
|
|
|
$
|
1,590,906
|
|
|
(a)
|
The
December 31, 2017
balances have been recast to reflect a change in segments. See Note 10, “Segment Information,” for additional information.
|
|
(b)
|
As of
December 31, 2017
,
$14.4 million
of Goodwill was classified as Assets held for sale in the condensed consolidated balance sheets. See Note 2, “Divestitures,” for additional information.
|
|
|
Customer Lists and Relationships
|
|
Trade Names and Trademarks
(a)
|
|
Patents and Technology
|
|
Other
|
|
Total
|
||||||||||
|
Gross Asset Value
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at December 31, 2017
|
$
|
439,312
|
|
|
$
|
18,981
|
|
|
$
|
61,618
|
|
|
$
|
37,256
|
|
|
$
|
557,167
|
|
|
Foreign currency translation adjustments and other
|
(4,653
|
)
|
|
(284
|
)
|
|
(5,335
|
)
|
|
6,579
|
|
|
(3,693
|
)
|
|||||
|
Balance at September 30, 2018
|
$
|
434,659
|
|
|
$
|
18,697
|
|
|
$
|
56,283
|
|
|
$
|
43,835
|
|
|
$
|
553,474
|
|
|
Accumulated Amortization
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at December 31, 2017
|
$
|
(74,704
|
)
|
|
$
|
(8,295
|
)
|
|
$
|
(35,203
|
)
|
|
$
|
(17,462
|
)
|
|
$
|
(135,664
|
)
|
|
Amortization
|
(17,682
|
)
|
|
—
|
|
|
(1,100
|
)
|
|
(2,464
|
)
|
|
(21,246
|
)
|
|||||
|
Foreign currency translation adjustments and other
|
1,003
|
|
|
41
|
|
|
919
|
|
|
(526
|
)
|
|
1,437
|
|
|||||
|
Balance at September 30, 2018
|
$
|
(91,383
|
)
|
|
$
|
(8,254
|
)
|
|
$
|
(35,384
|
)
|
|
$
|
(20,452
|
)
|
|
$
|
(155,473
|
)
|
|
Net Book Value at December 31, 2017
(b)
|
$
|
364,608
|
|
|
$
|
10,686
|
|
|
$
|
26,415
|
|
|
$
|
19,794
|
|
|
$
|
421,503
|
|
|
Net Book Value at September 30, 2018
|
$
|
343,276
|
|
|
$
|
10,443
|
|
|
$
|
20,899
|
|
|
$
|
23,383
|
|
|
$
|
398,001
|
|
|
(a)
|
Balances as of
September 30, 2018
and
December 31, 2017
include only indefinite-lived intangible assets.
|
|
(b)
|
As of
December 31, 2017
,
$3.6 million
of Other intangibles, net of amortization were classified as Assets held for sale in the condensed consolidated balance sheets. See Note 2, “Divestitures,” for additional information.
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Basic earnings per share
|
|
|
|
|
|
|
|
||||||||
|
Numerator:
|
|
|
|
|
|
|
|
||||||||
|
Net income attributable to Albemarle Corporation
|
$
|
129,745
|
|
|
$
|
118,670
|
|
|
$
|
563,966
|
|
|
$
|
273,216
|
|
|
Denominator:
|
|
|
|
|
|
|
|
||||||||
|
Weighted-average common shares for basic earnings per share
|
107,315
|
|
|
110,476
|
|
|
109,223
|
|
|
111,049
|
|
||||
|
Basic earnings per share
|
$
|
1.21
|
|
|
$
|
1.07
|
|
|
$
|
5.16
|
|
|
$
|
2.46
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Diluted earnings per share
|
|
|
|
|
|
|
|
||||||||
|
Numerator:
|
|
|
|
|
|
|
|
||||||||
|
Net income attributable to Albemarle Corporation
|
$
|
129,745
|
|
|
$
|
118,670
|
|
|
$
|
563,966
|
|
|
$
|
273,216
|
|
|
Denominator:
|
|
|
|
|
|
|
|
||||||||
|
Weighted-average common shares for basic earnings per share
|
107,315
|
|
|
110,476
|
|
|
109,223
|
|
|
111,049
|
|
||||
|
Incremental shares under stock compensation plans
|
987
|
|
|
1,499
|
|
|
1,053
|
|
|
1,407
|
|
||||
|
Weighted-average common shares for diluted earnings per share
|
108,302
|
|
|
111,975
|
|
|
110,276
|
|
|
112,456
|
|
||||
|
Diluted earnings per share
|
$
|
1.20
|
|
|
$
|
1.06
|
|
|
$
|
5.11
|
|
|
$
|
2.43
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
|
Finished goods
(a)
|
$
|
503,970
|
|
|
$
|
404,239
|
|
|
Raw materials and work in process
(b)
|
165,874
|
|
|
132,891
|
|
||
|
Stores, supplies and other
|
57,537
|
|
|
55,651
|
|
||
|
Total
(c)
|
$
|
727,381
|
|
|
$
|
592,781
|
|
|
(a)
|
Increase primarily due to the build-up of inventory in our Lithium and Catalysts segments resulting from higher forecasted sales.
|
|
(b)
|
Increase primarily due to higher forecasted production levels in the fourth quarter from our Catalysts segment. Included
$68.9 million
and
$59.6 million
at
September 30, 2018
and
December 31, 2017
, respectively, of work in process related to lithium brine.
|
|
(c)
|
As of
December 31, 2017
,
$24.7 million
of Inventories were classified as Assets held for sale in the condensed consolidated balance sheets. See Note 2, “Divestitures,” for additional information.
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
|
1.875% Senior notes, net of unamortized discount and debt issuance costs of $3,173 at September 30, 2018 and $3,971 at December 31, 2017
|
$
|
457,909
|
|
|
$
|
463,575
|
|
|
4.15% Senior notes, net of unamortized discount and debt issuance costs of $3,006 at September 30, 2018 and $3,372 at December 31, 2017
|
421,994
|
|
|
421,628
|
|
||
|
4.50% Senior notes, net of unamortized discount and debt issuance costs of $664 at September 30, 2018 and $891 at December 31, 2017
|
174,551
|
|
|
174,325
|
|
||
|
5.45% Senior notes, net of unamortized discount and debt issuance costs of $4,043 at September 30, 2018 and $4,159 at December 31, 2017
|
345,957
|
|
|
345,841
|
|
||
|
Commercial paper notes
|
285,500
|
|
|
421,321
|
|
||
|
Variable-rate foreign bank loans
|
7,080
|
|
|
5,298
|
|
||
|
Other
|
4,802
|
|
|
5,384
|
|
||
|
Total long-term debt
|
1,697,793
|
|
|
1,837,372
|
|
||
|
Less amounts due within one year
|
286,188
|
|
|
422,012
|
|
||
|
Long-term debt, less current portion
|
$
|
1,411,605
|
|
|
$
|
1,415,360
|
|
|
Beginning balance at December 31, 2017
|
$
|
39,808
|
|
|
Expenditures
|
(3,564
|
)
|
|
|
Accretion of discount
|
669
|
|
|
|
Additions and changes in estimates
|
16,236
|
|
|
|
Foreign currency translation adjustments
|
(346
|
)
|
|
|
Ending balance at September 30, 2018
|
52,803
|
|
|
|
Less amounts reported in Accrued expenses
|
5,012
|
|
|
|
Amounts reported in Other noncurrent liabilities
|
$
|
47,791
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
(In thousands)
|
||||||||||||||
|
Net sales:
|
|
|
|
|
|
|
|
||||||||
|
Lithium
|
$
|
270,928
|
|
|
$
|
269,238
|
|
|
$
|
886,523
|
|
|
$
|
729,288
|
|
|
Bromine Specialties
|
232,616
|
|
|
212,923
|
|
|
678,769
|
|
|
636,059
|
|
||||
|
Catalysts
|
251,139
|
|
|
244,594
|
|
|
796,822
|
|
|
756,407
|
|
||||
|
All Other
|
23,065
|
|
|
28,021
|
|
|
90,978
|
|
|
91,144
|
|
||||
|
Corporate
|
—
|
|
|
90
|
|
|
159
|
|
|
1,289
|
|
||||
|
Total net sales
|
$
|
777,748
|
|
|
$
|
754,866
|
|
|
$
|
2,453,251
|
|
|
$
|
2,214,187
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
|
Lithium
|
$
|
113,629
|
|
|
$
|
112,944
|
|
|
$
|
386,260
|
|
|
$
|
327,996
|
|
|
Bromine Specialties
|
78,585
|
|
|
63,936
|
|
|
217,921
|
|
|
194,499
|
|
||||
|
Catalysts
|
62,602
|
|
|
60,394
|
|
|
205,534
|
|
|
197,570
|
|
||||
|
All Other
|
3,968
|
|
|
306
|
|
|
7,729
|
|
|
7,906
|
|
||||
|
Corporate
|
(23,702
|
)
|
|
(28,197
|
)
|
|
(75,082
|
)
|
|
(88,271
|
)
|
||||
|
Total adjusted EBITDA
|
$
|
235,082
|
|
|
$
|
209,383
|
|
|
$
|
742,362
|
|
|
$
|
639,700
|
|
|
|
Lithium
|
|
Bromine Specialties
|
|
Catalysts
|
|
Reportable Segments Total
|
|
All Other
|
|
Corporate
|
|
Consolidated Total
|
||||||||||||||
|
Three months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
90,313
|
|
|
$
|
67,967
|
|
|
$
|
50,491
|
|
|
$
|
208,771
|
|
|
$
|
1,978
|
|
|
$
|
(81,004
|
)
|
|
$
|
129,745
|
|
|
Depreciation and amortization
|
23,370
|
|
|
10,618
|
|
|
12,111
|
|
|
46,099
|
|
|
1,990
|
|
|
1,618
|
|
|
49,707
|
|
|||||||
|
Restructuring and other
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,724
|
|
|
3,724
|
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,305
|
|
|
4,305
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,988
|
|
|
12,988
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,167
|
|
|
33,167
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,195
|
)
|
|
(2,195
|
)
|
|||||||
|
Legal accrual
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,017
|
)
|
|
(1,017
|
)
|
|||||||
|
Other
(d)
|
(54
|
)
|
|
—
|
|
|
—
|
|
|
(54
|
)
|
|
—
|
|
|
4,712
|
|
|
4,658
|
|
|||||||
|
Adjusted EBITDA
|
$
|
113,629
|
|
|
$
|
78,585
|
|
|
$
|
62,602
|
|
|
$
|
254,816
|
|
|
$
|
3,968
|
|
|
$
|
(23,702
|
)
|
|
$
|
235,082
|
|
|
Three months ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
89,745
|
|
|
$
|
53,760
|
|
|
$
|
47,846
|
|
|
$
|
191,351
|
|
|
$
|
(1,776
|
)
|
|
$
|
(70,905
|
)
|
|
$
|
118,670
|
|
|
Depreciation and amortization
|
22,316
|
|
|
10,176
|
|
|
13,798
|
|
|
46,290
|
|
|
2,082
|
|
|
1,523
|
|
|
49,895
|
|
|||||||
|
Utilization of inventory markup
(e)
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|||||||
|
Adjustment to gain on acquisition
(f)
|
1,408
|
|
|
—
|
|
|
—
|
|
|
1,408
|
|
|
—
|
|
|
—
|
|
|
1,408
|
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,635
|
|
|
5,635
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,792
|
|
|
15,792
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,495
|
|
|
18,495
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,028
|
)
|
|
(1,028
|
)
|
|||||||
|
Multiemployer plan shortfall contributions
(g)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,646
|
|
|
1,646
|
|
|||||||
|
Other
(h)
|
(1,093
|
)
|
|
—
|
|
|
(1,250
|
)
|
|
(2,343
|
)
|
|
—
|
|
|
645
|
|
|
(1,698
|
)
|
|||||||
|
Adjusted EBITDA
|
$
|
112,944
|
|
|
$
|
63,936
|
|
|
$
|
60,394
|
|
|
$
|
237,274
|
|
|
$
|
306
|
|
|
$
|
(28,197
|
)
|
|
$
|
209,383
|
|
|
Nine months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
315,939
|
|
|
$
|
187,176
|
|
|
$
|
387,038
|
|
|
$
|
890,153
|
|
|
$
|
1,659
|
|
|
$
|
(327,846
|
)
|
|
$
|
563,966
|
|
|
Depreciation and amortization
|
71,760
|
|
|
30,745
|
|
|
37,201
|
|
|
139,706
|
|
|
6,070
|
|
|
4,735
|
|
|
150,511
|
|
|||||||
|
Restructuring and other
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,724
|
|
|
3,724
|
|
|||||||
|
Gain on sale of business
(i)
|
—
|
|
|
—
|
|
|
(218,705
|
)
|
|
(218,705
|
)
|
|
—
|
|
|
—
|
|
|
(218,705
|
)
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,016
|
|
|
13,016
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39,834
|
|
|
39,834
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
133,630
|
|
|
133,630
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,596
|
)
|
|
(6,596
|
)
|
|||||||
|
Legal accrual
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,027
|
|
|
27,027
|
|
|||||||
|
Albemarle Foundation contribution
(j)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,000
|
|
|
15,000
|
|
|||||||
|
Other
(d)
|
(1,439
|
)
|
|
—
|
|
|
—
|
|
|
(1,439
|
)
|
|
—
|
|
|
22,394
|
|
|
20,955
|
|
|||||||
|
Adjusted EBITDA
|
$
|
386,260
|
|
|
$
|
217,921
|
|
|
$
|
205,534
|
|
|
$
|
809,715
|
|
|
$
|
7,729
|
|
|
$
|
(75,082
|
)
|
|
$
|
742,362
|
|
|
Nine months ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
249,178
|
|
|
$
|
164,193
|
|
|
$
|
158,806
|
|
|
$
|
572,177
|
|
|
$
|
1,622
|
|
|
$
|
(300,583
|
)
|
|
$
|
273,216
|
|
|
Depreciation and amortization
|
62,841
|
|
|
30,306
|
|
|
40,014
|
|
|
133,161
|
|
|
6,284
|
|
|
4,642
|
|
|
144,087
|
|
|||||||
|
Utilization of inventory markup
(e)
|
23,095
|
|
|
—
|
|
|
—
|
|
|
23,095
|
|
|
—
|
|
|
—
|
|
|
23,095
|
|
|||||||
|
Restructuring and other
(k)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,141
|
|
|
17,141
|
|
|||||||
|
Gain on acquisition
(f)
|
(6,025
|
)
|
|
—
|
|
|
—
|
|
|
(6,025
|
)
|
|
—
|
|
|
—
|
|
|
(6,025
|
)
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,395
|
|
|
26,395
|
|
|||||||
|
Interest and financing expenses
(l)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
98,895
|
|
|
98,895
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,596
|
|
|
53,596
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,144
|
)
|
|
(3,144
|
)
|
|||||||
|
Multiemployer plan shortfall contributions
(g)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,586
|
|
|
6,586
|
|
|||||||
|
Other
(h)
|
(1,093
|
)
|
|
—
|
|
|
(1,250
|
)
|
|
(2,343
|
)
|
|
—
|
|
|
8,201
|
|
|
5,858
|
|
|||||||
|
Adjusted EBITDA
|
$
|
327,996
|
|
|
$
|
194,499
|
|
|
$
|
197,570
|
|
|
$
|
720,065
|
|
|
$
|
7,906
|
|
|
$
|
(88,271
|
)
|
|
$
|
639,700
|
|
|
(a)
|
Expected severance payments as part of a business reorganization plan, recorded in Selling, general and administrative expenses. The unpaid balance is recorded in Accrued expenses at September 30, 2018, and is expected to be paid out by the end of 2018.
|
|
(b)
|
Included amounts for the
three-month and nine-month
periods ended September 30, 2018 recorded in (1) Cost of goods sold of
$0.9 million
and
$2.9 million
, respectively; and (2) Selling, general and administrative expenses of
$3.4 million
and
$10.2 million
, respectively, relating to various significant projects. Included amounts for the
three-month and nine-month
periods ended September 30, 2017 recorded in (1) Cost of goods sold of
$1.8 million
and
$12.5 million
, respectively; and (2) Selling, general and administrative expenses of
$3.8 million
and
$13.9 million
, respectively, relating to various significant projects, including the Jiangxi Jiangli New Materials Science and Technology Co. Ltd. (“Jiangli New Materials”) acquisition, which contains unusual compensation related costs negotiated specifically as a result of this acquisition that are outside of the Company’s normal compensation arrangements.
|
|
(c)
|
Included in Other income (expenses), net. See Note 9, “Commitments and Contingencies,” for additional information.
|
|
(d)
|
Included amounts for the three months ended September 30, 2018 recorded in:
|
|
▪
|
Cost of goods sold -
$3.8 million
for the write-off of fixed assets related to a major capacity expansion in our Jordanian joint venture.
|
|
▪
|
Selling, general and administrative expenses -
$0.1 million
gain related to a refund from Chilean authorities due to an overpayment made in a prior year, partially offset by a
$1.2 million
contribution, using a portion of the proceeds received from the Polyolefin Catalysts Divestiture, to schools in the state of Louisiana for qualified tuition purposes. This contribution is significant in size and is intended to provide long-term benefits for families in the Louisiana community.
|
|
▪
|
Other income (expenses), net -
$0.2 million
gain related to the revision of previously recorded expenses of disposed businesses.
|
|
▪
|
Cost of goods sold -
$4.9 million
for the write-off of fixed assets related to a major capacity expansion in our Jordanian joint venture.
|
|
▪
|
Selling, general and administrative expenses -
$1.5 million
gain related to a refund from Chilean authorities due to an overpayment made in a prior year, partially offset by a
$1.2 million
contribution, using a portion of the proceeds received from Polyolefin Catalysts Divestiture, to schools in the state of Louisiana for qualified tuition purposes. This contribution is significant in size and is intended to provide long-term benefits for families in the Louisiana community.
|
|
▪
|
Other income (expenses), net -
$15.6 million
of environmental charges related to a site formerly owned by Albemarle and
$0.8 million
related to the revision of previously recorded expenses of disposed businesses.
|
|
(e)
|
In connection with the acquisition of Jiangli New Materials, the Company valued inventory purchased from Jiangli New Materials at fair value, which resulted in a markup of the underlying net book value of the inventory totaling approximately
$23.1 million
. The inventory
|
|
(f)
|
Gain recorded in Other income (expenses), net related to the acquisition of the remaining
50%
interest in the Sales de Magnesio Ltda. joint venture in Chile.
|
|
(g)
|
Included shortfall contributions for our multiemployer plan financial improvement plan. See Note 11, “Pension Plans and Other Postretirement Benefits,” for additional information.
|
|
(h)
|
Included amounts for the three-month period ended September 30, 2017 recorded in:
|
|
▪
|
Cost of goods sold -
$1.3 million
reversal of deferred income related to an abandoned project at an unconsolidated investment.
|
|
▪
|
Other income (expenses), net -
$1.1 million
related to a reversal of a liability associated with the previous disposal of a property, partially offset by the revision of tax indemnification expenses of
$0.7 million
primarily related to the filing of tax returns for a previously disposed business.
|
|
▪
|
Cost of goods sold -
$1.3 million
reversal of deferred income related to an abandoned project at an unconsolidated investment.
|
|
▪
|
Selling, general and administrative expenses -
$1.0 million
related to a reversal of an accrual recorded as part of purchase accounting from a previous acquisition.
|
|
▪
|
Other income (expenses), net -
$3.2 million
of asset retirement obligation charges related to the revision of an estimate at a site formerly owned by Albemarle, losses of
$4.1 million
associated with the previous disposal of businesses and the revision of tax indemnification expenses of
$1.9 million
primarily related to the filing of tax returns and a competent authority agreement for a previously disposed business. This is partially offset by
$1.1 million
related to a reversal of a liability associated with the previous disposal of a property.
|
|
(i)
|
See Note 2, “Divestitures,” for additional information.
|
|
(j)
|
Included in Selling, general and administrative expenses is a charitable contribution, using a portion of the proceeds received from the Polyolefin Catalysts Divestiture, to the Albemarle Foundation, a non-profit organization that sponsors grants, health and social projects, educational initiatives, disaster relief, matching gift programs, scholarships and other charitable initiatives in locations where our employees live and operate. This contribution is in addition to the normal annual contribution made to the Albemarle Foundation by the Company, and is significant in size and nature in that it is intended to provide more long-term benefits in the communities where we live and operate.
|
|
(k)
|
During 2017, we initiated action to reduce costs in each of our reportable segments at several locations, primarily at our Lithium sites in Germany. Based on the restructuring plans, we have recorded expenses of
$2.9 million
in Cost of goods sold,
$8.4 million
in Selling, general and administrative expenses and
$5.8 million
in Research and development expenses for the nine-month period ended September 30, 2017, primarily related to expected severance payments. The unpaid balance is recorded in Accrued expenses at September 30, 2018, with the expectation that the majority of these plans will be completed by the end of 2018.
|
|
(l)
|
During the first quarter of 2017, we repaid the
3.00%
Senior notes in full,
€307.0 million
of the
1.875%
Senior notes and
$174.7 million
of the
4.50%
Senior notes, as well as related tender premiums of
$45.2 million
. As a result, included in Interest and financing expenses is a loss on early extinguishment of debt of
$52.8 million
, representing the tender premiums, fees, unamortized discounts and unamortized deferred financing costs from the redemption of these senior notes.
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Pension Benefits Cost (Credit):
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
1,238
|
|
|
$
|
1,067
|
|
|
$
|
3,765
|
|
|
$
|
3,090
|
|
|
Interest cost
|
7,967
|
|
|
8,375
|
|
|
24,010
|
|
|
24,983
|
|
||||
|
Expected return on assets
|
(10,703
|
)
|
|
(9,960
|
)
|
|
(32,227
|
)
|
|
(29,799
|
)
|
||||
|
Amortization of prior service benefit
|
25
|
|
|
29
|
|
|
71
|
|
|
102
|
|
||||
|
Total net pension benefits credit
|
$
|
(1,473
|
)
|
|
$
|
(489
|
)
|
|
$
|
(4,381
|
)
|
|
$
|
(1,624
|
)
|
|
Postretirement Benefits Cost (Credit):
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
$
|
29
|
|
|
$
|
30
|
|
|
$
|
88
|
|
|
$
|
91
|
|
|
Interest cost
|
542
|
|
|
585
|
|
|
1,626
|
|
|
1,755
|
|
||||
|
Expected return on assets
|
(1
|
)
|
|
(28
|
)
|
|
(5
|
)
|
|
(83
|
)
|
||||
|
Amortization of prior service benefit
|
(12
|
)
|
|
(24
|
)
|
|
(36
|
)
|
|
(72
|
)
|
||||
|
Total net postretirement benefits cost
|
$
|
558
|
|
|
$
|
563
|
|
|
$
|
1,673
|
|
|
$
|
1,691
|
|
|
Total net pension and postretirement benefits (credit) cost
|
$
|
(915
|
)
|
|
$
|
74
|
|
|
$
|
(2,708
|
)
|
|
$
|
67
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
|
Recorded
Amount
|
|
Fair Value
|
|
Recorded
Amount
|
|
Fair Value
|
||||||||
|
|
(In thousands)
|
||||||||||||||
|
Long-term debt
|
$
|
1,704,894
|
|
|
$
|
1,744,139
|
|
|
$
|
1,845,309
|
|
|
$
|
1,949,638
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
|
Foreign currency forward contracts - Other accounts receivable
|
$
|
142
|
|
|
$
|
—
|
|
|
Foreign currency forward contracts - Accrued expenses
|
$
|
—
|
|
|
$
|
4,954
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Foreign currency forward contracts (losses) gains
|
$
|
(203
|
)
|
|
$
|
803
|
|
|
$
|
(13,034
|
)
|
|
$
|
9,010
|
|
|
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
|
|
|
September 30, 2018
|
|
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)
|
$
|
27,871
|
|
|
$
|
27,871
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Private equity securities
(b)
|
$
|
31
|
|
|
$
|
31
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Private equity securities measured at net asset value
(b)(c)
|
$
|
7,194
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Foreign currency forward contracts
(d)
|
$
|
142
|
|
|
$
|
—
|
|
|
$
|
142
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
|
Obligations under executive deferred compensation plan
(a)
|
$
|
27,871
|
|
|
$
|
27,871
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
December 31, 2017
|
|
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)
|
$
|
25,494
|
|
|
$
|
25,494
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Private equity securities
(b)
|
$
|
38
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Private equity securities measured at net asset value
(b)(c)
|
$
|
5,121
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
|
Obligations under executive deferred compensation plan
(a)
|
$
|
25,494
|
|
|
$
|
25,494
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Foreign currency forward contracts
(d)
|
$
|
4,954
|
|
|
$
|
—
|
|
|
$
|
4,954
|
|
|
$
|
—
|
|
|
(a)
|
We maintain an Executive Deferred Compensation Plan (“EDCP”) that was adopted in 2001 and subsequently amended. The purpose of the EDCP is to provide current tax planning opportunities as well as supplemental funds upon the retirement or death of certain of our employees. The EDCP is intended to aid in attracting and retaining employees of exceptional ability by providing them with these benefits. We also maintain a Benefit Protection Trust (the “Trust”) that was created to provide a source of funds to assist in meeting the obligations of the EDCP, subject to the claims of our creditors in the event of our insolvency. Assets of the Trust are consolidated in accordance with authoritative guidance. The assets of the Trust consist primarily of mutual fund investments (which are accounted for as trading securities and are marked-to-market on a monthly basis through the consolidated statements of income) and cash and cash equivalents. As such, these assets and obligations are classified within Level 1.
|
|
(b)
|
Primarily consists of private equity securities classified as available-for-sale and are reported in Investments in the condensed consolidated balance sheets. The changes in fair value are reported in Other income (expenses), net, in our consolidated statements of income.
|
|
(c)
|
Holdings in certain private equity securities are measured at fair value using the net asset value per share (or its equivalent) practical expedient and have not been categorized in the fair value hierarchy.
|
|
(d)
|
As a result of our global operating and financing activities, we are exposed to market risks from changes in foreign currency exchange rates, which may adversely affect our operating results and financial position. When deemed appropriate, we minimize our risks from foreign currency exchange rate fluctuations through the use of foreign currency forward contracts. Unless otherwise noted, these derivative financial instruments are not designated as hedging instruments under ASC 815,
Derivatives and Hedging
. 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.
|
|
|
Foreign Currency Translation
|
|
Pension and Postretirement Benefits
(a)
|
|
Net Investment Hedge
|
|
Interest Rate Swap
(b)
|
|
Total
|
||||||||||
|
Three months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at June 30, 2018
|
$
|
(343,458
|
)
|
|
$
|
5
|
|
|
$
|
55,119
|
|
|
$
|
(13,345
|
)
|
|
$
|
(301,679
|
)
|
|
Other comprehensive loss before reclassifications
|
(9,549
|
)
|
|
—
|
|
|
(3,621
|
)
|
|
—
|
|
|
(13,170
|
)
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
11
|
|
|
—
|
|
|
642
|
|
|
653
|
|
|||||
|
Other comprehensive (loss) income, net of tax
|
(9,549
|
)
|
|
11
|
|
|
(3,621
|
)
|
|
642
|
|
|
(12,517
|
)
|
|||||
|
Other comprehensive loss attributable to noncontrolling interests
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
|
Balance at September 30, 2018
|
$
|
(353,002
|
)
|
|
$
|
16
|
|
|
$
|
51,498
|
|
|
$
|
(12,703
|
)
|
|
$
|
(314,191
|
)
|
|
Three months ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at June 30, 2017
|
$
|
(341,690
|
)
|
|
$
|
85
|
|
|
$
|
60,459
|
|
|
$
|
(15,687
|
)
|
|
$
|
(296,833
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
56,179
|
|
|
—
|
|
|
(9,681
|
)
|
|
—
|
|
|
46,498
|
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
529
|
|
|
522
|
|
|||||
|
Other comprehensive income (loss), net of tax
|
56,179
|
|
|
(7
|
)
|
|
(9,681
|
)
|
|
529
|
|
|
47,020
|
|
|||||
|
Other comprehensive income attributable to noncontrolling interests
|
(130
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(130
|
)
|
|||||
|
Balance at September 30, 2017
|
$
|
(285,641
|
)
|
|
$
|
78
|
|
|
$
|
50,778
|
|
|
$
|
(15,158
|
)
|
|
$
|
(249,943
|
)
|
|
Nine months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at December 31, 2017
|
$
|
(257,569
|
)
|
|
$
|
(21
|
)
|
|
$
|
46,551
|
|
|
$
|
(14,629
|
)
|
|
$
|
(225,668
|
)
|
|
Other comprehensive (loss) income before reclassifications
|
(95,515
|
)
|
|
—
|
|
|
4,947
|
|
|
—
|
|
|
(90,568
|
)
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
37
|
|
|
—
|
|
|
1,926
|
|
|
1,963
|
|
|||||
|
Other comprehensive (loss) income, net of tax
|
(95,515
|
)
|
|
37
|
|
|
4,947
|
|
|
1,926
|
|
|
(88,605
|
)
|
|||||
|
Other comprehensive loss attributable to noncontrolling interests
|
82
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|||||
|
Balance at September 30, 2018
|
$
|
(353,002
|
)
|
|
$
|
16
|
|
|
$
|
51,498
|
|
|
$
|
(12,703
|
)
|
|
$
|
(314,191
|
)
|
|
Nine months ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance at December 31, 2016
|
$
|
(484,121
|
)
|
|
$
|
76
|
|
|
$
|
88,378
|
|
|
$
|
(16,745
|
)
|
|
$
|
(412,412
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
199,303
|
|
|
—
|
|
|
(37,600
|
)
|
|
—
|
|
|
161,703
|
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
2
|
|
|
—
|
|
|
1,587
|
|
|
1,589
|
|
|||||
|
Other comprehensive income (loss), net of tax
|
199,303
|
|
|
2
|
|
|
(37,600
|
)
|
|
1,587
|
|
|
163,292
|
|
|||||
|
Other comprehensive income attributable to noncontrolling interests
|
(823
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(823
|
)
|
|||||
|
Balance at September 30, 2017
|
$
|
(285,641
|
)
|
|
$
|
78
|
|
|
$
|
50,778
|
|
|
$
|
(15,158
|
)
|
|
$
|
(249,943
|
)
|
|
(a)
|
The pre-tax portion of amounts reclassified from accumulated other comprehensive loss consists of amortization of prior service benefit, which is a component of pension and postretirement benefits credit. See Note 11, “Pension Plans and Other Postretirement Benefits.”
|
|
(b)
|
The pre-tax portion of amounts reclassified from accumulated other comprehensive loss is included in interest expense.
|
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
|
|
Foreign Currency Translation
|
|
Pension and Postretirement Benefits
|
|
Net Investment Hedge
|
|
Interest Rate Swap
|
|
Foreign Currency Translation
|
|
Pension and Postretirement Benefits
|
|
Net Investment Hedge
|
|
Interest Rate Swap
|
||||||||||||||||
|
Other comprehensive (loss) income, before tax
|
$
|
(9,550
|
)
|
|
$
|
13
|
|
|
$
|
(4,704
|
)
|
|
$
|
834
|
|
|
$
|
56,156
|
|
|
$
|
—
|
|
|
$
|
(15,266
|
)
|
|
$
|
834
|
|
|
Income tax benefit (expense)
|
1
|
|
|
(2
|
)
|
|
1,083
|
|
|
(192
|
)
|
|
23
|
|
|
(7
|
)
|
|
5,585
|
|
|
(305
|
)
|
||||||||
|
Other comprehensive (loss) income, net of tax
|
$
|
(9,549
|
)
|
|
$
|
11
|
|
|
$
|
(3,621
|
)
|
|
$
|
642
|
|
|
$
|
56,179
|
|
|
$
|
(7
|
)
|
|
$
|
(9,681
|
)
|
|
$
|
529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
|
|
Foreign Currency Translation
|
|
Pension and Postretirement Benefits
|
|
Net Investment Hedge
|
|
Interest Rate Swap
|
|
Foreign Currency Translation
|
|
Pension and Postretirement Benefits
|
|
Net Investment Hedge
|
|
Interest Rate Swap
|
||||||||||||||||
|
Other comprehensive (loss) income, before tax
|
$
|
(95,517
|
)
|
|
$
|
43
|
|
|
$
|
6,426
|
|
|
$
|
2,502
|
|
|
$
|
200,366
|
|
|
$
|
10
|
|
|
$
|
(59,292
|
)
|
|
$
|
2,502
|
|
|
Income tax benefit (expense)
|
2
|
|
|
(6
|
)
|
|
(1,479
|
)
|
|
(576
|
)
|
|
(1,063
|
)
|
|
(8
|
)
|
|
21,692
|
|
|
(915
|
)
|
||||||||
|
Other comprehensive (loss) income, net of tax
|
$
|
(95,515
|
)
|
|
$
|
37
|
|
|
$
|
4,947
|
|
|
$
|
1,926
|
|
|
$
|
199,303
|
|
|
$
|
2
|
|
|
$
|
(37,600
|
)
|
|
$
|
1,587
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
Sales to unconsolidated affiliates
|
$
|
4,970
|
|
|
$
|
7,309
|
|
|
$
|
20,608
|
|
|
$
|
23,753
|
|
|
Purchases from unconsolidated affiliates
(a)
|
$
|
60,136
|
|
|
$
|
51,983
|
|
|
$
|
186,111
|
|
|
$
|
148,502
|
|
|
(a)
|
Purchases from unconsolidated affiliates primarily relate to purchases from our Windfield joint venture.
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
|
Receivables from unconsolidated affiliates
|
$
|
2,734
|
|
|
$
|
2,406
|
|
|
Payables to unconsolidated affiliates
|
$
|
54,227
|
|
|
$
|
55,801
|
|
|
|
Nine Months Ended
September 30, |
||||||
|
|
2018
|
|
2017
|
||||
|
Supplemental non-cash disclosure related to investing activities:
|
|
|
|
||||
|
Capital expenditures included in Accounts payable
|
$
|
107,385
|
|
|
$
|
53,421
|
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
|
•
|
changes in economic and business conditions;
|
|
•
|
changes in financial and operating performance of our major customers and industries and markets served by us;
|
|
•
|
the timing of orders received from customers;
|
|
•
|
the gain or loss of significant customers;
|
|
•
|
competition from other manufacturers;
|
|
•
|
changes in the demand for our products or the end-user markets in which our products are sold;
|
|
•
|
limitations or prohibitions on the manufacture and sale of our products;
|
|
•
|
availability of raw materials;
|
|
•
|
increases in the cost of raw materials and energy, and our ability to pass through such increases to our customers;
|
|
•
|
changes in our markets in general;
|
|
•
|
fluctuations in foreign currencies;
|
|
•
|
changes in laws and government regulation impacting our operations or our products;
|
|
•
|
the occurrence of regulatory actions, proceedings, claims or litigation;
|
|
•
|
the occurrence of cyber-security breaches, terrorist attacks, industrial accidents, natural disasters or climate change;
|
|
•
|
hazards associated with chemicals manufacturing;
|
|
•
|
the inability to maintain current levels of product or premises liability insurance or the denial of such coverage;
|
|
•
|
political unrest affecting the global economy, including adverse effects from terrorism or hostilities;
|
|
•
|
political instability affecting our manufacturing operations or joint ventures;
|
|
•
|
changes in accounting standards;
|
|
•
|
the inability to achieve results from our global manufacturing cost reduction initiatives as well as our ongoing continuous improvement and rationalization programs;
|
|
•
|
changes in the jurisdictional mix of our earnings and changes in tax laws and rates;
|
|
•
|
changes in monetary policies, inflation or interest rates that may impact our ability to raise capital or increase our cost of funds, impact the performance of our pension fund investments and increase our pension expense and funding obligations;
|
|
•
|
volatility and uncertainties in the debt and equity markets;
|
|
•
|
technology or intellectual property infringement, including through cyber-security breaches, and other innovation risks;
|
|
•
|
decisions we may make in the future;
|
|
•
|
the ability to successfully execute, operate and integrate acquisitions and divestitures; and
|
|
•
|
the other factors detailed from time to time in the reports we file with the SEC.
|
|
•
|
We completed our May 2018 accelerated share repurchase (“ASR”) agreement, receiving and retiring a final settlement of
326,571
shares in September 2018. Under this agreement we received and retired a total of
2,680,704
shares during the nine months ended September 30, 2018. In addition, we entered into a separate $250 million ASR agreement in August 2018, receiving and retiring an initial delivery of
1,984,914
shares of our common stock pursuant to the terms of the second ASR agreement and our share repurchase program. This second ASR agreement is expected to be completed by the end of the fourth quarter of 2018.
|
|
•
|
Our board of directors declared a quarterly dividend of
$0.335
per share on
July 26, 2018
, which was paid on
October 1, 2018
to shareholders of record at the close of business as of
September 14, 2018
.
|
|
•
|
Our net sales for the quarter were
$777.7 million
, up
3%
from net sales of
$754.9 million
in the
third
quarter of
2017
.
|
|
•
|
Earnings per share were
$1.20
(on a diluted basis), an increase from
third
quarter
2017
results of
$1.06
per diluted share.
|
|
•
|
Cash provided by operating activities was
$153.1 million
in the
third
quarter, an increase from
$129.3 million
in the third quarter of 2017.
|
|
|
Three Months Ended September 30,
|
|
Percentage Change
|
|||||||
|
|
2018
|
|
2017
|
|
2018 vs. 2017
|
|||||
|
|
(In thousands, except percentages and per share amounts)
|
|||||||||
|
NET SALES
|
$
|
777,748
|
|
|
$
|
754,866
|
|
|
3
|
%
|
|
Cost of goods sold
|
497,211
|
|
|
479,210
|
|
|
4
|
%
|
||
|
GROSS PROFIT
|
280,537
|
|
|
275,656
|
|
|
2
|
%
|
||
|
GROSS PROFIT MARGIN
|
36.1
|
%
|
|
36.5
|
%
|
|
|
|||
|
Selling, general and administrative expenses
|
100,167
|
|
|
106,471
|
|
|
(6
|
)%
|
||
|
Research and development expenses
|
16,610
|
|
|
21,763
|
|
|
(24
|
)%
|
||
|
OPERATING PROFIT
|
163,760
|
|
|
147,422
|
|
|
11
|
%
|
||
|
OPERATING PROFIT MARGIN
|
21.1
|
%
|
|
19.5
|
%
|
|
|
|||
|
Interest and financing expenses
|
(12,988
|
)
|
|
(15,792
|
)
|
|
(18
|
)%
|
||
|
Other income (expenses), net
|
3,793
|
|
|
(1,986
|
)
|
|
(291
|
)%
|
||
|
INCOME BEFORE INCOME TAXES AND EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS
|
154,565
|
|
|
129,644
|
|
|
19
|
%
|
||
|
Income tax expense
|
33,167
|
|
|
18,495
|
|
|
79
|
%
|
||
|
Effective tax rate
|
21.5
|
%
|
|
14.3
|
%
|
|
|
|||
|
INCOME BEFORE EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS
|
121,398
|
|
|
111,149
|
|
|
9
|
%
|
||
|
Equity in net income of unconsolidated investments (net of tax)
|
22,081
|
|
|
19,044
|
|
|
16
|
%
|
||
|
NET INCOME
|
143,479
|
|
|
130,193
|
|
|
10
|
%
|
||
|
Net income attributable to noncontrolling interests
|
(13,734
|
)
|
|
(11,523
|
)
|
|
19
|
%
|
||
|
NET INCOME ATTRIBUTABLE TO ALBEMARLE CORPORATION
|
$
|
129,745
|
|
|
$
|
118,670
|
|
|
9
|
%
|
|
PERCENTAGE OF NET SALES
|
16.7
|
%
|
|
15.7
|
%
|
|
|
|||
|
Basic earnings per share
|
$
|
1.21
|
|
|
$
|
1.07
|
|
|
13
|
%
|
|
Diluted earnings per share
|
$
|
1.20
|
|
|
$
|
1.06
|
|
|
13
|
%
|
|
|
Three Months Ended September 30,
|
|
Percentage Change
|
|||||||||||||
|
|
2018
|
|
%
|
|
2017
|
|
%
|
|
2018 vs. 2017
|
|||||||
|
|
(In thousands, except percentages)
|
|||||||||||||||
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|||||||
|
Lithium
|
$
|
270,928
|
|
|
34.8
|
%
|
|
$
|
269,238
|
|
|
35.7
|
%
|
|
1
|
%
|
|
Bromine Specialties
|
232,616
|
|
|
29.9
|
%
|
|
212,923
|
|
|
28.2
|
%
|
|
9
|
%
|
||
|
Catalysts
|
251,139
|
|
|
32.3
|
%
|
|
244,594
|
|
|
32.4
|
%
|
|
3
|
%
|
||
|
All Other
|
23,065
|
|
|
3.0
|
%
|
|
28,021
|
|
|
3.7
|
%
|
|
(18
|
)%
|
||
|
Corporate
|
—
|
|
|
—
|
%
|
|
90
|
|
|
—
|
%
|
|
(100
|
)%
|
||
|
Total net sales
|
$
|
777,748
|
|
|
100.0
|
%
|
|
$
|
754,866
|
|
|
100.0
|
%
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|||||||
|
Lithium
|
$
|
113,629
|
|
|
48.4
|
%
|
|
$
|
112,944
|
|
|
53.9
|
%
|
|
1
|
%
|
|
Bromine Specialties
|
78,585
|
|
|
33.4
|
%
|
|
63,936
|
|
|
30.5
|
%
|
|
23
|
%
|
||
|
Catalysts
|
62,602
|
|
|
26.6
|
%
|
|
60,394
|
|
|
28.9
|
%
|
|
4
|
%
|
||
|
All Other
|
3,968
|
|
|
1.7
|
%
|
|
306
|
|
|
0.2
|
%
|
|
*
|
|
||
|
Corporate
|
(23,702
|
)
|
|
(10.1
|
)%
|
|
(28,197
|
)
|
|
(13.5
|
)%
|
|
(16
|
)%
|
||
|
Total adjusted EBITDA
|
$
|
235,082
|
|
|
100.0
|
%
|
|
$
|
209,383
|
|
|
100.0
|
%
|
|
12
|
%
|
|
|
Lithium
|
|
Bromine Specialties
|
|
Catalysts
|
|
Reportable Segments Total
|
|
All Other
|
|
Corporate
|
|
Consolidated Total
|
||||||||||||||
|
Three months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
90,313
|
|
|
$
|
67,967
|
|
|
$
|
50,491
|
|
|
$
|
208,771
|
|
|
$
|
1,978
|
|
|
$
|
(81,004
|
)
|
|
$
|
129,745
|
|
|
Depreciation and amortization
|
23,370
|
|
|
10,618
|
|
|
12,111
|
|
|
46,099
|
|
|
1,990
|
|
|
1,618
|
|
|
49,707
|
|
|||||||
|
Restructuring and other
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,724
|
|
|
3,724
|
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,305
|
|
|
4,305
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,988
|
|
|
12,988
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,167
|
|
|
33,167
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,195
|
)
|
|
(2,195
|
)
|
|||||||
|
Legal accrual
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,017
|
)
|
|
(1,017
|
)
|
|||||||
|
Other
(d)
|
(54
|
)
|
|
—
|
|
|
—
|
|
|
(54
|
)
|
|
—
|
|
|
4,712
|
|
|
4,658
|
|
|||||||
|
Adjusted EBITDA
|
$
|
113,629
|
|
|
$
|
78,585
|
|
|
$
|
62,602
|
|
|
$
|
254,816
|
|
|
$
|
3,968
|
|
|
$
|
(23,702
|
)
|
|
$
|
235,082
|
|
|
Three months ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
89,745
|
|
|
$
|
53,760
|
|
|
$
|
47,846
|
|
|
$
|
191,351
|
|
|
$
|
(1,776
|
)
|
|
$
|
(70,905
|
)
|
|
$
|
118,670
|
|
|
Depreciation and amortization
|
22,316
|
|
|
10,176
|
|
|
13,798
|
|
|
46,290
|
|
|
2,082
|
|
|
1,523
|
|
|
49,895
|
|
|||||||
|
Utilization of inventory markup
(e)
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|||||||
|
Adjustment to gain on acquisition
(f)
|
1,408
|
|
|
—
|
|
|
—
|
|
|
1,408
|
|
|
—
|
|
|
—
|
|
|
1,408
|
|
|||||||
|
Acquisition and integration related costs
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,635
|
|
|
5,635
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,792
|
|
|
15,792
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,495
|
|
|
18,495
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,028
|
)
|
|
(1,028
|
)
|
|||||||
|
Multiemployer plan shortfall contributions
(g)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,646
|
|
|
1,646
|
|
|||||||
|
Other
(h)
|
(1,093
|
)
|
|
—
|
|
|
(1,250
|
)
|
|
(2,343
|
)
|
|
—
|
|
|
645
|
|
|
(1,698
|
)
|
|||||||
|
Adjusted EBITDA
|
$
|
112,944
|
|
|
$
|
63,936
|
|
|
$
|
60,394
|
|
|
$
|
237,274
|
|
|
$
|
306
|
|
|
$
|
(28,197
|
)
|
|
$
|
209,383
|
|
|
(a)
|
Expected severance payments as part of a business reorganization plan, recorded in Selling, general and administrative expenses. The unpaid balance is recorded in Accrued expenses at September 30, 2018, and is expected to be paid out by the end of 2018.
|
|
(b)
|
Included amounts for the three-month periods ended September 30, 2018 and 2017 recorded in (1) Cost of goods sold of
$0.9 million
and
$1.8 million
, respectively; and (2) Selling, general and administrative expenses of
$3.4 million
and
$3.8 million
, respectively, relating to various significant projects.
|
|
(c)
|
Included in Other income (expenses), net is a gain of
$1.4 million
related to the revision of an accrual resulting from a jury rendered verdict against Albemarle related to certain business concluded under a 2014 sales agreement for products that Albemarle no longer manufactures, partially offset by a
$0.4 million
charge related to the revision of an accrual resulting from a settlement of a legal matter related to guarantees from a previously disposed business.
|
|
(d)
|
Included amounts for the three months ended September 30, 2018 recorded in:
|
|
•
|
Cost of goods sold -
$3.8 million
for the write-off of fixed assets related to a major capacity expansion in our Jordanian joint venture.
|
|
•
|
Selling, general and administrative expenses -
$0.1 million
gain related to a refund from Chilean authorities due to an overpayment made in a prior year, partially offset by a
$1.2 million
contribution, using a portion of the proceeds received from the Polyolefin Catalysts Divestiture, to schools in the state of Louisiana for qualified tuition purposes. This contribution is significant in size and is intended to provide long-term benefits for families in the Louisiana community.
|
|
•
|
Other income (expenses), net -
$0.2 million
gain related to the revision of previously recorded expenses of disposed businesses.
|
|
(e)
|
In connection with the acquisition of Jiangxi Jiangli New Materials Science and Technology Co. Ltd. (“Jiangli New Materials”), the Company valued inventory purchased from Jiangli New Materials at fair value, which resulted in a markup of the underlying net book value of the inventory totaling approximately
$23.1 million
. The inventory markup was expensed over the estimated remaining selling period. For the three-month period ended September 30, 2017,
$0.6 million
was included in Cost of goods sold related to the utilization of the inventory markup.
|
|
(f)
|
Gain recorded in Other income (expenses), net related to the acquisition of the remaining 50% interest in the Sales de Magnesio Ltda. joint venture in Chile.
|
|
(g)
|
Included in Other income (expenses), net, is
$1.6 million
for additional capital reserve contributions to a multiemployer plan, which is subject to a financial improvement plan, to indemnify previously divested businesses.
|
|
(h)
|
Included amounts for the three months ended September 30, 2017 recorded in:
|
|
▪
|
Cost of goods sold -
$1.3 million
reversal of deferred income related to an abandoned project at an unconsolidated investment.
|
|
▪
|
Other income (expenses), net -
$1.1 million
related to a reversal of a liability associated with the previous disposal of a property, partially offset by the revision of tax indemnification expenses of
$0.7 million
primarily related to the filing of tax returns for a previously disposed business.
|
|
|
Nine Months Ended September 30,
|
|
Percentage Change
|
|||||||
|
|
2018
|
|
2017
|
|
2018 vs 2017
|
|||||
|
|
(In thousands, except percentages and per share amounts)
|
|||||||||
|
NET SALES
|
$
|
2,453,251
|
|
|
$
|
2,214,187
|
|
|
11
|
%
|
|
Cost of goods sold
|
1,556,379
|
|
|
1,411,614
|
|
|
10
|
%
|
||
|
GROSS PROFIT
|
896,872
|
|
|
802,573
|
|
|
12
|
%
|
||
|
GROSS PROFIT MARGIN
|
36.6
|
%
|
|
36.2
|
%
|
|
|
|||
|
Selling, general and administrative expenses
|
325,174
|
|
|
331,984
|
|
|
(2
|
)%
|
||
|
Research and development expenses
|
53,670
|
|
|
63,423
|
|
|
(15
|
)%
|
||
|
Gain on sale of business
|
(218,705
|
)
|
|
—
|
|
|
*
|
|
||
|
OPERATING PROFIT
|
736,733
|
|
|
407,166
|
|
|
81
|
%
|
||
|
OPERATING PROFIT MARGIN
|
30.0
|
%
|
|
18.4
|
%
|
|
|
|||
|
Interest and financing expenses
|
(39,834
|
)
|
|
(98,895
|
)
|
|
(60
|
)%
|
||
|
Other expenses, net
|
(31,906
|
)
|
|
(3,399
|
)
|
|
*
|
|
||
|
INCOME BEFORE INCOME TAXES AND EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS
|
664,993
|
|
|
304,872
|
|
|
118
|
%
|
||
|
Income tax expense
|
133,630
|
|
|
53,596
|
|
|
149
|
%
|
||
|
Effective tax rate
|
20.1
|
%
|
|
17.6
|
%
|
|
|
|||
|
INCOME BEFORE EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS
|
531,363
|
|
|
251,276
|
|
|
111
|
%
|
||
|
Equity in net income of unconsolidated investments (net of tax)
|
61,727
|
|
|
55,263
|
|
|
12
|
%
|
||
|
NET INCOME
|
593,090
|
|
|
306,539
|
|
|
93
|
%
|
||
|
Net income attributable to noncontrolling interests
|
(29,124
|
)
|
|
(33,323
|
)
|
|
(13
|
)%
|
||
|
NET INCOME ATTRIBUTABLE TO ALBEMARLE CORPORATION
|
$
|
563,966
|
|
|
$
|
273,216
|
|
|
106
|
%
|
|
PERCENTAGE OF NET SALES
|
23.0
|
%
|
|
12.3
|
%
|
|
|
|||
|
Basic earnings per share
|
$
|
5.16
|
|
|
$
|
2.46
|
|
|
110
|
%
|
|
Diluted earnings per share
|
$
|
5.11
|
|
|
$
|
2.43
|
|
|
110
|
%
|
|
|
Nine Months Ended September 30,
|
|
Percentage Change
|
|||||||||||||
|
|
2018
|
|
%
|
|
2017
|
|
%
|
|
2018 vs. 2017
|
|||||||
|
|
(In thousands, except percentages)
|
|||||||||||||||
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|||||||
|
Lithium
|
$
|
886,523
|
|
|
36.1
|
%
|
|
$
|
729,288
|
|
|
32.9
|
%
|
|
22
|
%
|
|
Bromine Specialties
|
678,769
|
|
|
27.7
|
%
|
|
636,059
|
|
|
28.7
|
%
|
|
7
|
%
|
||
|
Catalysts
|
796,822
|
|
|
32.5
|
%
|
|
756,407
|
|
|
34.2
|
%
|
|
5
|
%
|
||
|
All Other
|
90,978
|
|
|
3.7
|
%
|
|
91,144
|
|
|
4.1
|
%
|
|
—
|
%
|
||
|
Corporate
|
159
|
|
|
—
|
%
|
|
1,289
|
|
|
0.1
|
%
|
|
(88
|
)%
|
||
|
Total net sales
|
$
|
2,453,251
|
|
|
100.0
|
%
|
|
$
|
2,214,187
|
|
|
100.0
|
%
|
|
11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|||||||
|
Lithium
|
$
|
386,260
|
|
|
52.0
|
%
|
|
$
|
327,996
|
|
|
51.3
|
%
|
|
18
|
%
|
|
Bromine Specialties
|
217,921
|
|
|
29.4
|
%
|
|
194,499
|
|
|
30.4
|
%
|
|
12
|
%
|
||
|
Catalysts
|
205,534
|
|
|
27.7
|
%
|
|
197,570
|
|
|
30.8
|
%
|
|
4
|
%
|
||
|
All Other
|
7,729
|
|
|
1.0
|
%
|
|
7,906
|
|
|
1.3
|
%
|
|
(2
|
)%
|
||
|
Corporate
|
(75,082
|
)
|
|
(10.1
|
)%
|
|
(88,271
|
)
|
|
(13.8
|
)%
|
|
(15
|
)%
|
||
|
Total adjusted EBITDA
|
$
|
742,362
|
|
|
100.0
|
%
|
|
$
|
639,700
|
|
|
100.0
|
%
|
|
16
|
%
|
|
|
Lithium
|
|
Bromine Specialties
|
|
Catalysts
|
|
Reportable Segments Total
|
|
All Other
|
|
Corporate
|
|
Consolidated Total
|
||||||||||||||
|
Nine Months Ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
315,939
|
|
|
$
|
187,176
|
|
|
$
|
387,038
|
|
|
$
|
890,153
|
|
|
$
|
1,659
|
|
|
$
|
(327,846
|
)
|
|
$
|
563,966
|
|
|
Depreciation and amortization
|
71,760
|
|
|
30,745
|
|
|
37,201
|
|
|
139,706
|
|
|
6,070
|
|
|
4,735
|
|
|
150,511
|
|
|||||||
|
Restructuring and other
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,724
|
|
|
3,724
|
|
|||||||
|
Gain on sale of business
(b)
|
—
|
|
|
—
|
|
|
(218,705
|
)
|
|
(218,705
|
)
|
|
—
|
|
|
—
|
|
|
(218,705
|
)
|
|||||||
|
Acquisition and integration related costs
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,016
|
|
|
13,016
|
|
|||||||
|
Interest and financing expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39,834
|
|
|
39,834
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
133,630
|
|
|
133,630
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,596
|
)
|
|
(6,596
|
)
|
|||||||
|
Multiemployer plan shortfall contributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
Legal accrual
(d)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,027
|
|
|
27,027
|
|
|||||||
|
Albemarle Foundation contribution
(e)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,000
|
|
|
15,000
|
|
|||||||
|
Other
(f)
|
(1,439
|
)
|
|
—
|
|
|
—
|
|
|
(1,439
|
)
|
|
—
|
|
|
22,394
|
|
|
20,955
|
|
|||||||
|
Adjusted EBITDA
|
$
|
386,260
|
|
|
$
|
217,921
|
|
|
$
|
205,534
|
|
|
$
|
809,715
|
|
|
$
|
7,729
|
|
|
$
|
(75,082
|
)
|
|
$
|
742,362
|
|
|
Nine Months Ended September 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Net income (loss) attributable to Albemarle Corporation
|
$
|
249,178
|
|
|
$
|
164,193
|
|
|
$
|
158,806
|
|
|
$
|
572,177
|
|
|
$
|
1,622
|
|
|
$
|
(300,583
|
)
|
|
$
|
273,216
|
|
|
Depreciation and amortization
|
62,841
|
|
|
30,306
|
|
|
40,014
|
|
|
133,161
|
|
|
6,284
|
|
|
4,642
|
|
|
144,087
|
|
|||||||
|
Utilization of inventory markup
(g)
|
23,095
|
|
|
—
|
|
|
—
|
|
|
23,095
|
|
|
—
|
|
|
—
|
|
|
23,095
|
|
|||||||
|
Restructuring and other
(h)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,141
|
|
|
17,141
|
|
|||||||
|
Gain on acquisition
(i)
|
(6,025
|
)
|
|
—
|
|
|
—
|
|
|
(6,025
|
)
|
|
—
|
|
|
—
|
|
|
(6,025
|
)
|
|||||||
|
Acquisition and integration related costs
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,395
|
|
|
26,395
|
|
|||||||
|
Interest and financing expenses
(j)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
98,895
|
|
|
98,895
|
|
|||||||
|
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,596
|
|
|
53,596
|
|
|||||||
|
Non-operating pension and OPEB items
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,144
|
)
|
|
(3,144
|
)
|
|||||||
|
Multiemployer plan shortfall contributions
(k)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,586
|
|
|
6,586
|
|
|||||||
|
Other
(l)
|
(1,093
|
)
|
|
—
|
|
|
(1,250
|
)
|
|
(2,343
|
)
|
|
—
|
|
|
8,201
|
|
|
5,858
|
|
|||||||
|
Adjusted EBITDA
|
$
|
327,996
|
|
|
$
|
194,499
|
|
|
$
|
197,570
|
|
|
$
|
720,065
|
|
|
$
|
7,906
|
|
|
$
|
(88,271
|
)
|
|
$
|
639,700
|
|
|
(a)
|
Expected severance payments as part of a business reorganization plan, recorded in Selling, general and administrative expenses. The unpaid balance is recorded in Accrued expenses at September 30, 2018, and is expected to be paid out by the end of 2018.
|
|
(b)
|
See “
Gain on Sale of Business
” on page 36 for a description of this gain.
|
|
(c)
|
Included amounts for the
nine
-month periods ended
September 30, 2018
and
2017
recorded in (1) Cost of goods sold of
$2.9 million
and
$12.5 million
, respectively; and (2) Selling, general and administrative expenses of
$10.2 million
and
$13.9 million
, respectively, relating to various significant projects.
|
|
(d)
|
Included in Other expenses, net is a
$16.2 million
accrual resulting from a jury rendered verdict against Albemarle related to certain business concluded under a 2014 sales agreement for products that Albemarle no longer manufactures and a
$10.8 million
accrual resulting from a settlement of a legal matter related to guarantees from a previously disposed business.
|
|
(e)
|
Included in Selling, general and administrative expenses is a charitable contribution, using a portion of the proceeds received from the Polyolefin Catalysts Divestiture, to the Albemarle Foundation, a non-profit organization that sponsors grants, health and social projects, educational initiatives, disaster relief, matching gift programs, scholarships and other charitable initiatives in locations where our employees live and operate. This contribution is in addition to the ordinary annual contribution made to the Albemarle Foundation by the Company, and is significant in size and nature in that it is intended to provide more long-term benefits in the communities where we live and operate.
|
|
(f)
|
Included amounts for the nine months ended
September 30, 2018
recorded in:
|
|
•
|
Cost of goods sold -
$4.9 million
for the write-off of fixed assets related to a major capacity expansion in our Jordanian joint venture.
|
|
•
|
Selling, general and administrative expenses -
$1.5 million
gain related to a refund from Chilean authorities due to an overpayment made in a prior year, partially offset by a
$1.2 million
contribution, using a portion of the proceeds received from the Polyolefin Catalysts Divestiture, to schools in the state of Louisiana for qualified tuition purposes. This contribution is significant in size and is intended to provide long-term benefits for families in the Louisiana community.
|
|
•
|
Other expenses, net -
$15.6 million
of environmental charges related to a site formerly owned by Albemarle and
$0.8 million
related to the revision of previously recorded expenses of disposed businesses.
|
|
(g)
|
In connection with the acquisition of Jiangli New Materials, the Company valued inventory purchased from Jiangli New Materials at fair value, which resulted in a markup of the underlying net book value of the inventory totaling approximately
$23.1 million
. The inventory markup was expensed over the estimated remaining selling period. For the
nine-month period ended
September 30, 2017
,
$23.1 million
was included in Cost of goods sold related to the utilization of the inventory markup.
|
|
(h)
|
During 2017, we initiated action to reduce costs in each of our reportable segments at several locations, primarily at our Lithium sites in Germany. Based on the restructuring plans, we have recorded expenses of
$2.9 million
in Cost of goods sold,
$8.4 million
in Selling, general and administrative expenses and
$5.8 million
in Research and development expenses, primarily related to restructuring costs. The unpaid balance is recorded in Accrued expenses at
September 30, 2018
, with the expectation that the majority of this plan will be completed by the end of 2018.
|
|
(i)
|
Gain recorded in Other expenses, net related to the acquisition of the remaining 50% interest in the Sales de Magnesio Ltda. joint venture in Chile.
|
|
(j)
|
During the first quarter of 2017, we repaid the
3.00%
Senior notes in full,
€307.0 million
of the
1.875%
Senior notes and
$174.7 million
of the
4.50%
Senior notes, as well as related tender premiums of
$45.2 million
. As a result, included in Interest and financing expenses is a loss on early extinguishment of debt of
$52.8 million
, representing the tender premiums, fees unamortized discounts and unamortized deferred financing costs from the redemption of these senior notes.
|
|
(k)
|
Included in Selling, general and administrative expenses is
$2.0 million
for additional capital reserve contributions to a multiemployer plan, which is subject to a financial improvement plan. In addition, additional capital reserve contributions for this multiemployer plan of
$4.6 million
, included in Other expenses, net, have been made to indemnify previously divested businesses.
|
|
(l)
|
Included amounts for the nine months ended September 30, 2017 recorded in:
|
|
▪
|
Cost of goods sold -
$1.3 million
reversal of deferred income related to an abandoned project at an unconsolidated investment.
|
|
▪
|
Selling, general and administrative expenses -
$1.0 million
related to a reversal of an accrual recorded as part of purchase accounting from a previous acquisition.
|
|
▪
|
Other expenses, net -
$3.2 million
of asset retirement obligation charges related to the revision of an estimate at a site formerly owned by Albemarle, losses of
$4.1 million
associated with the previous disposal of a businesses and the revision of tax indemnification expenses of
$1.9 million
primarily related to the filing of tax returns and a competent authority agreement for a previously disposed business. This is partially offset by
$1.1 million
related to a reversal of a liability associated with the previous disposal of a property.
|
|
Issue Month/Year
|
|
Principal (in millions)
|
|
Interest Rate
|
|
Interest Payment Dates
|
|
Maturity Date
|
|
|
December 2014
|
|
€393.0
|
|
1.875%
|
|
December 8
|
|
December 8, 2021
|
|
|
November 2014
|
|
$425.0
|
|
4.15%
|
|
June 1
|
December 1
|
|
December 1, 2024
|
|
November 2014
|
|
$350.0
|
|
5.45%
|
|
June 1
|
December 1
|
|
December 1, 2044
|
|
December 2010
|
|
$175.3
|
|
4.50%
|
|
June 15
|
December 15
|
|
December 15, 2020
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk.
|
|
Item 4.
|
Controls and Procedures.
|
|
Item 1.
|
Legal Proceedings.
|
|
Item 1A.
|
Risk Factors.
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds.
|
|
Period
|
|
Total Number of Shares Repurchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs
(a)
|
|
Maximum Number of Shares that May Yet Be Repurchased Under the Plans or Programs
|
|||||
|
July 1, 2018 to July 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
10,304,784
|
|
|
August 1, 2018 to August 31, 2018
(b)
|
|
1,984,914
|
|
|
100.76
|
|
|
1,984,914
|
|
|
8,319,870
|
|
|
|
September 1, 2018 to September 30, 2018
(c)
|
|
326,571
|
|
|
93.19
|
|
|
326,571
|
|
|
7,993,299
|
|
|
|
Total
|
|
2,311,485
|
|
|
|
|
2,311,485
|
|
|
|
|||
|
(a)
|
Our stock repurchase plan, which was authorized by our Board of Directors, permits the Company to repurchase up to a maximum of
15,000,000
shares. The stock repurchase plan will expire when we have repurchased all shares authorized for repurchase thereunder, unless the stock repurchase plan is earlier terminated by action of our Board of Directors or further shares are authorized for repurchase.
|
|
(b)
|
In the third quarter of 2018, we paid $250 million under the ASR agreement, receiving and retiring an initial delivery of 1,984,914 shares. This agreement is expected to be completed in the fourth quarter of 2018. The Average Price Paid Per Share was calculated using the closing price per share of our common stock the date the ASR agreement was signed. See Item 1 Financial Statements - Note 5, “Earnings Per Share,” to the condensed consolidated financial statements included in this quarterly report.
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(c)
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In the second quarter of 2018, we paid $250 million under the ASR agreement. Under the terms of the agreement, in September 2018 the ASR agreement was completed and we received and retired a final settlement of 326,751 shares. The Average Price Paid Per Share was calculated using the daily Rule 10b-18 volume-weighted average prices of our common stock over the term of the ASR agreement, less an agreed discount. See Item 1 Financial Statements - Note 5, “Earnings Per Share,” to the condensed consolidated financial statements included in this quarterly report.
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Item 6.
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Exhibits.
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101
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Interactive Data File (Quarterly Report on Form 10-Q, for the quarterly period ended September 30, 2018, furnished in XBRL (eXtensible Business Reporting Language)).
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ALBEMARLE CORPORATION
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(Registrant)
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Date:
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November 7, 2018
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By:
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/
S
/ S
COTT
A. T
OZIER
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Scott A. Tozier
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Executive Vice President and Chief Financial Officer
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(principal financial officer)
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No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|---|---|---|
RALF H. CRAMER Mr. Cramer has served as Industry Advisor/Consultant at Knowledge Experienced, an automotive and industrial consulting company, since 2018. He has also served as a Senior Consultant at Shenzhen Shentou Investment Co Ltd., a cross-border M&A consultancy and investment company, since 2018. Mr. Cramer has served on the boards of directors of Knorr-Bremse Truck, a subsidiary of Knorr-Bremse A.G., a braking system manufacturer, since December 2018, and Coperion GmbH, a subsidiary of Hillenbrand Group, a technology provider for plastics industry, since Jan 2024. Mr. Cramer served on the board of directors of Metalsa S.A., an automotive solutions provider, from May 2019 to May 2024, on the board of directors of BBS Automation GmbH, an automation solutions provider, from May 2018 to October 2023, as an Executive Board Member of Continental AG, which develops technologies and services for mobility of people and goods, from 2009 to 2017, and as President, Global Division Chassis & Safety from 2008 to 2013. During that time, Mr. Cramer also served as President and CEO of Continental China, an automotive component manufacturer, from 2013 to 2017. Attributes and Skills: Mr. Cramer’s executive experience with multinational companies in the automotive industry and manufacturing operations, as well as his deep experience in China and interactions with Chinese industry leaders, brings an international business perspective to our Board. Mr. Cramer’s extensive knowledge of the global automotive industry and operational, financial, and international leadership experience supports his re-election to our Board. | |||
M. LAUREN BRLAS Ms. Brlas retired from the Newmont Mining Corporation (“Newmont”), a global gold company and producer of copper, silver, zinc, and lead, in December 2016. Ms. Brlas joined Newmont in 2013 and served as Executive Vice President and Chief Financial Officer until October 2016. From 2006 through 2013, Ms. Brlas held various positions of increasing responsibility with Cleveland-Cliffs Inc., a North American producer of iron ore and steel, where ultimately she served as Chief Financial Officer and then as Executive Vice President and President, Global Operations. Attributes and Skills: Ms. Brlas brings significant operational and financial executive leadership experience, including in the natural resources industry, to our Board. This executive leadership experience as well as Ms. Brlas’ extensive background in financial and governance matters supports her re-election to our Board. Other Public Company Directorships: • Autoliv, Inc. (a developer, manufacturer, and marketer of airbags, seatbelts, and steering wheels), 2020 – current • Graphic Packaging International, LLC (a producer of paper-based packaging solutions), 2019 – current • Constellation Energy Corporation (an energy provider), 2022 – 2024 • Exelon Corporation (an energy provider), 2018 – 2022 • Perrigo Company plc (a producer of self-care health solutions), 2003 – 2019 | |||
J. KENT MASTERS, JR. Mr. Masters has served as Chairman and CEO of Albemarle since 2020. He joined the Albemarle Board of Directors in 2015 and served as Lead Independent Director from 2018 to April 2020. Prior to joining Albemarle, Mr. Masters served as Chief Executive Officer of Foster Wheeler AG, a global engineering and construction contractor and power equipment supplier, from 2011 to 2014, when Foster Wheeler AG was acquired by Amec plc to form Amec Foster Wheeler plc. Attributes and Skills: Mr. Masters brings significant global business experience in key industries relevant to our large capital projects, such as engineering and construction, power equipment, and industrial gases, to our Board. Mr. Masters’ global business experience as well as his previous experience in the lithium industry (including his prior service on the board of directors for Rockwood Holdings, Inc.) supports his re-election to our Board. | |||
JAMES J. O'BRIEN Mr. O’Brien served as Chairman of the Board and Chief Executive Officer from 2002 to 2014, as President and C hief Operating Officer in 2002, and as Senior Vice President and Group Operating Officer from 2001 to 2002 of Ashland Inc., a diversified energy company. Mr. O’Brien served as President of Valvoline, a global marketer and supplier of premium branded lubricants and automotive services, from 1995 to 2001. Mr. O’Brien worked at Ashland for 38 years prior to his retirement in December 2014. Attributes and Skills: Mr. O’Brien brings extensive knowledge of the chemical industry and significant experience gained from service on the board of directors of other public companies to our Board. Mr. O’Brien’s industry knowledge and public company board experience as well as his significant management experience and knowledge in the areas of finance, accounting, international business operations, risk oversight, and corporate governance supports his re-election to our Board. Other Public Company Directorships: • Eastman Chemical Company (a specialty chemical company), 2016 – current • Humana Inc. (a managed health care company), 2006 – 2023 | |||
HOLLY A. VAN DEURSEN Ms. Van Deursen served as Group Vice President, Petrochemicals, at BP plc, a global provider of heat, light and mobility products and services, having starting working there in 1989 and holding various senior executive management roles before retiring as a member of the top-forty executive management team from 2000 to 2005. Ms. Van Deursen has twenty-five years of experience in the chemical, oil, and energy industries, including various engineering, manufacturing, and product development roles for Dow Corning Corporation (a chemical and plastics manufacturer and supplier). Attributes and Skills: Ms. Van Deursen brings extensive experience in the chemical, industrial, and contract manufacturing sectors, including from her previous service as a director for companies in the oilfield services, diversified industrial, and packaging sectors, to our Board. Ms. Van Deursen’s experience across sectors as well as her service in executive roles in business management, business development, and mergers & acquisitions in the U.S. and globally supports her re-election to our Board. Other Public Company Directorships: • Kimball Electronics Inc. (a global contract manufacturer of durable goods electronics serving a variety of industries), 2019 – current • Synthomer plc (a global supplier of acrylic and vinyl emulsions and specialty polymers), 2018 – current • Capstone Green Energy Corporation (a global producer of highly efficient, low-emission, resilient microturbine energy systems), Chair 2017 – 2020; director 2007 – 2021 • Enerpac Tool Group (formerly Actuant Corporation) (a diversified industrial company), 2008 – 2020 | |||
GLENDA J. MINOR Ms. Minor has served as Chief Executive Officer and Principal of Silket Advisory Services, a privately owned consulting firm advising companies on financial, strategic and operational initiatives, since 2016. Prior to Silket, she served as Senior Vice President and Chief Financial Officer of Evraz North America Limited, a North American steel manufacturer from 2010 to 2016. Ms. Minor also served as Vice President, Finance, Controller, Chief Accounting Officer, and General Auditor of Visteon Corporation, a global technology company that designs, engineers, and manufactures cockpit electronics and connected car solutions, from 2000 to 2010. She has also served on the board of the Capital Area United Way since 2020. Attributes and Skills: Ms. Minor brings extensive financial and international leadership experience across different industries and different continents to our Board. Ms. Minor’s financial and international leadership experience as well as her in-depth understanding of the preparation and analysis of financial statements and her experience in capital market transactions, accounting, treasury, investor relations, financial and strategic planning, and business expansion supports her re-election to our Board. Other Public Company Directorships: • Radius Recycling (a global provider in the metals recycling industry and a manufacturer of finished steel products), 2020 – current • Curtiss-Wright Corporation (a global provider of products and services in the aerospace & defense and industrial markets), 2019 – current | |||
GERALD A. STEINER Mr. Steiner co-founded CoverCress, Inc., a company developing a new crop for renewable fuels, and served as CEO from 2015 to 2021 and as Executive Chairman from 2021 until its acquisition in 2022. He also manages Alta Grow Consulting LLC, a business consulting firm he founded in 2014. Mr. Steiner served as Executive Vice President, Sustainability and Corporate Affairs at Monsanto Company, a leading global provider of agricultural products for farmers, from 2003 to 2014 and head of corporate strategy prior to that time. Since 2023, he has served as Executive Chair of Pluton BioSciences, an agricultural microbials company, an Advisor for Ilumina Ventures, a genomics and precision health venture firm, as well as serving other AgTech start-up companies. Among other roles, Mr. Steiner has also served at the following organizations: • Chairman, 2012 – 2014, and board member, 2003 – 2014, Food and Agriculture Section of BIO (Biotechnology Industry Organization) • Chairman, 2012 – 2013, board member, 2014, and Trustee Emeritus, 2015 – current, The Keystone Center (a policy center for agriculture, early childhood education, and energy for rural communities) • Co-founder, Field to Market (an agricultural sustainability organization); Executive Chairman of Stony Creek Colors (a plant-based dyes company) since 2021 Attributes and Skills: Mr. Steiner brings extensive experience in the renewable fuels and agricultural industry to our Board. This industry experience as well as Mr. Steiner’s extensive experience in government affairs, global business, and strategy supports his re-election to our Board. | |||
DIARMUID B. O'CONNELL Mr. O'Connell served as Chief Strategy Officer of Fair Financial Corp., an automotive leasing fintech company, from 2018 to 2019. Prior to Fair Financial, Mr. O’Connell served as Vice President, Corporate & Business Development at Tesla Motors Inc., an American electric vehicle manufacturer, energy storage company, and solar panel manufacturer, from 2010 to 2017 and Vice President, Business Development from 2006 to 2010. Mr. O’Connell served as Chief of Staff, Bureau of Political Military Affairs at the U.S. Department of State from 2003 to 2006. Attributes and Skills: Mr. O'Connell brings experience in the electric vehicle and energy storage industry as well as valuable perspectives on global applications of alternative energy that provide insights into the end uses of our products to our Board. This industry knowledge as well as Mr. O'Connell’s background in marketing, government relations, operations, and manufacturing supports his re-election to our Board. Other Public Company Directorships: • Dana Incorporated (a global manufacturer in drivetrain and e-Propulsion systems), 2018 – current • Volvo Car AB (a company that designs, manufactures, and supplies automobiles), 2021 – current • Tech and Energy Transition Corporation (a special purpose acquisition company), 2021 – 2023 | |||
DEAN L. SEAVERS Mr. Seavers has served as a senior advisor at Stifel Financial Corp., a full-service financial services firm, since 2020. Prior to then, Mr. Seavers served as President of National Grid U.S., a U.S. supplier of consumer energy, from 2014 to 2019 and as Executive Director of National Grid plc, a multinational electricity and gas utility company, from 2015 to 2019. Mr. Seavers founded and served as Chief Executive Officer, President and Director of Red Hawk Fire & Security, a provider of life safety and security solutions, from 2012 to 2018, and President of Global Services of the Fire & Security business of United Technologies Corporation, an aerospace and defense company, from 2010 to 2011. Attributes and Skills: Mr. Seavers brings an operational perspective and vision to our Board from a variety of industries representing end uses of our products. Mr. Seavers’ extensive executive leadership and deep energy, fire safety and technology industry experience supports his re-election to our Board. Other Public Company Directorships: • CenterPoint Energy, Inc. (a U.S. public utility holding company), 2024 – current • Ametek, Inc. (a global manufacturer of electronic instruments and electromechanical devices), 2022 – current • PG&E Corporation / Pacific Gas & Electric Company (a holding company of natural gas / electric energy utility company), 2020 – 2022; Chairman, Pacific Gas & Electric Company, 2020 – 2022 • James Hardie Industries plc (a producer and marketer of fiber cement siding and backerboard and of fiber gypsum products), 2021 – 2022 | |||
ALEJANDRO D. WOLFF Mr. Wolff served as Managing Director of Gryphon Partners LLC, a global advisory firm focused on frontier markets, from 2014 to 2016. Prior to Gryphon, he served as U.S. Ambassador to Chile from 2010 to 2013 and U.S. Ambassador to the United Nations from 2005 to 2010. Mr. Wolff has thirty-three years of service in the U.S. Department of State, including service in Algeria, Morocco, Chile, Cyprus, the U.S. Mission to the European Union in Brussels, and as Deputy Chief of Mission and Charge d’Affaires in France. Attributes and Skills: Mr. Wolff brings expertise in international political, economic, and commercial affairs to our Board. This expertise as well as Mr. Wolff’s lithium industry experience (including his prior service on the board of directors for Rockwood Holdings, Inc.) supports his re-election to our Board. Other Public Company Directorships: • Frontier Group Holdings, Inc. (the holding company of Frontier Airlines, an ultra-low cost airline), 2019 – current • PG&E Corporation / Pacific Gas & Electric Company (a holding company of natural gas / electric energy utility company), 2019 – 2020 • Versum Materials, Inc. (an electronic materials company), 2016 – 2019 |
| Name and Principal Position |
Year
|
Salary
($) |
Bonus
($) |
Stock Awards
($) |
Option Awards
($) |
Non-Equity Incentive Plan Compensation
($)
|
Change in Pension Value and Nonqualified Deferred Compensation Earnings
($) |
All Other Compensation
($) |
Total
($) |
||||||||||||||||||||
| J. Kent Masters, Jr. | 2024 | $ | 1,400,000 | $ | — | $ | 7,880,872 | $ | 2,500,015 | $ | 2,201,850 | $ | — | $ | 385,761 | $ | 14,368,498 | ||||||||||||
| Chairman and Chief Executive Officer | 2023 | $ | 1,334,038 | $ | — | $ | 8,232,532 | $ | 2,500,044 | $ | 1,921,915 | $ | — | $ | 483,585 | $ | 14,472,114 | ||||||||||||
| 2022 | $ | 1,139,346 | $ | — | $ | 5,044,043 | $ | 1,625,022 | $ | 2,929,916 | $ | — | $ | 379,829 | $ | 11,118,156 | |||||||||||||
| Neal R. Sheorey | 2024 | $ | 600,000 | $ | — | $ | 1,576,174 | $ | 500,003 | $ | 503,280 | $ | — | $ | 283,879 | $ | 3,463,336 | ||||||||||||
| Executive Vice President and Chief Financial Officer | 2023 | $ | 23,077 | $ | 300,000 | $ | 673,959 | $ | — | $ | 73,644 | $ | — | $ | 18,937 | $ | 1,089,617 | ||||||||||||
| Melissa H. Anderson | 2024 | $ | 551,250 | $ | — | $ | 985,342 | $ | 312,508 | $ | 462,389 | $ | — | $ | 128,941 | $ | 2,440,430 | ||||||||||||
| Executive Vice President, Chief People and Transformation Officer | $ | — | |||||||||||||||||||||||||||
| Netha N. Johnson, Jr. | 2024 | $ | 636,571 | $ | — | $ | 1,576,174 | $ | 500,003 | $ | 487,274 | $ | — | $ | 115,065 | $ | 3,315,087 | ||||||||||||
| Executive Vice President, Chief Operations Officer | 2023 | $ | 622,420 | $ | — | $ | 1,646,506 | $ | 500,009 | $ | 292,898 | $ | — | $ | 171,936 | $ | 3,233,769 | ||||||||||||
| 2022 | $ | 576,095 | $ | — | $ | 1,048,012 | $ | 337,554 | $ | 808,365 | $ | — | $ | 124,458 | $ | 2,894,484 | |||||||||||||
| Eric W. Norris | 2024 | $ | 640,181 | $ | — | $ | 1,576,174 | $ | 500,003 | $ | 573,730 | $ | — | $ | 144,051 | $ | 3,434,139 | ||||||||||||
| Executive Vice President, Chief Commercial Officer | 2023 | $ | 631,973 | $ | — | $ | 1,646,506 | $ | 500,009 | $ | 484,376 | $ | — | $ | 183,781 | $ | 3,446,645 | ||||||||||||
| 2022 | $ | 601,432 | $ | — | $ | 1,048,012 | $ | 337,554 | $ | 879,222 | $ | — | $ | 169,947 | $ | 3,036,167 | |||||||||||||
| Kristin M. Coleman | 2024 | $ | 645,779 | $ | — | $ | 866,877 | $ | 275,009 | $ | — | $ | — | $ | 2,959,135 | $ | 4,746,800 | ||||||||||||
| Former Executive Vice President, General Counsel and Corporate Secretary | 2023 | $ | 653,000 | $ | — | $ | 906,236 | $ | 275,064 | $ | 522,400 | $ | — | $ | 193,368 | $ | 2,550,068 | ||||||||||||
| 2022 | $ | 37,673 | $ | 427,625 | $ | 2,458,484 | $ | — | $ | 88,875 | $ | — | $ | 5,159 | $ | 3,017,816 | |||||||||||||
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|---|---|---|
| Masters J Kent | - | 114,654 | 0 |
| Tozier Scott | - | 69,503 | 1,610 |
| Masters J Kent | - | 45,996 | 0 |
| Johnson Netha N. | - | 42,114 | 0 |
| Norris Eric | - | 33,905 | 0 |
| Norris Eric | - | 26,596 | 0 |
| Crawford Raphael Goszcz | - | 22,117 | 0 |
| Fourie Jacobus G. | - | 16,517 | 0 |
| NARWOLD KAREN G | - | 10,368 | 559 |
| Mummert Mark Richard | - | 6,802 | 0 |
| OConnell Diarmuid B. | - | 5,471 | 0 |
| LaBauve Donald J. Jr. | - | 5,035 | 12,505 |
| Barichivich John Clarence III | - | 4,743 | 1,232 |
| Anderson Melissa H. | - | 2,232 | 173 |
| Coleman Kristin M. | - | 1,373 | 2,746 |
| Sheorey Neal Ravi | - | 1,243 | 0 |