Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

Reportable Segments Summarized Financial Information

Segment information for the three-month and nine-month periods ended September 30, 2023 and 2022 were as follows (in thousands). Prior period amounts have been recast to reflect the current segment structure.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net sales:
Energy Storage	$	1,697,163	$	1,414,053	$	5,403,910	$	2,680,150
Specialties	352,722		441,928		1,142,802		1,354,950
Ketjen	260,711		235,824		714,326		664,026


Total net sales	$	2,310,596	$	2,091,805	$	7,261,038	$	4,699,126









Adjusted EBITDA:
Energy Storage	$	407,476	$	1,084,643	$	2,745,680	$	1,853,407
Specialties	46,307		133,558		268,665		433,534
Ketjen	15,159		4,635		72,584		31,337
Total segment adjusted EBITDA	468,942		1,222,836		3,086,929		2,318,278

Corporate	(15,655)		(32,870)		(5,657)		(86,173)
Total adjusted EBITDA	$	453,287	$	1,189,966	$	3,081,272	$	2,232,105

Depreciation and amortization:
Energy Storage	$	67,323	$	44,591	$	176,025	$	118,451
Specialties	22,699		16,939		63,890		50,002
Ketjen	13,259		12,689		39,486		38,785

Corporate	2,164		3,494		6,400		8,042
Total depreciation and amortization	$	105,445	$	77,713	$	285,801	$	215,280

See below for a reconciliation of total segment adjusted EBITDA to the companies consolidated Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reported in accordance with U.S. GAAP (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Total segment adjusted EBITDA	$	468,942	$	1,222,836	$	3,086,929	$	2,318,278
Corporate expenses, net	(15,655)		(32,870)		(5,657)		(86,173)
Depreciation and amortization	(105,445)		(77,713)		(285,801)		(215,280)
Interest and financing expenses(a)	(29,332)		(29,691)		(81,686)		(98,934)
Income tax expense	8,551		(196,938)		(311,399)		(366,486)

Loss on sale of interest in properties, net(b)	—		—		—		(8,400)
Acquisition and integration related costs(c)	(10,043)		(2,145)		(21,653)		(9,244)

Non-operating pension and OPEB items	(620)		5,027		(1,833)		15,345

Mark-to-market gain on public equity securities(d)	(26,445)		10,626		34,401		10,626
Legal accrual(e)	—		—		(218,510)		—


Other(f)	12,580		(1,917)		(3,635)		(2,361)
Net income attributable to Albemarle Corporation	$	302,533	$	897,215	$	2,191,156	$	1,557,371

(a)Included in Interest and financing expenses for the nine-month period ended September 30, 2022 was a loss on early extinguishment of debt of $19.2 million following the May 2022 repayment of Senior Notes due in 2024. In addition, included in Interest and financing expenses for the nine-month period ended September 30, 2022 is the correction of an out of period error of $17.5 million related to the overstatement of capitalized interest in prior periods.

(b)Expense recorded as a result of revised estimates of the obligation to construct certain lithium hydroxide conversion assets in Kemerton, Western Australia, due to cost overruns from supply chain, labor and COVID-19 pandemic related issues. The corresponding obligation was recorded in Accrued liabilities to be transferred to MRL, which maintains a 40% ownership interest in these Kemerton assets.

(c)Costs related to the acquisition, integration and potential divestitures for various significant projects, recorded in Selling, general and administrative expenses (“SG&A”).

(d)(Loss) gain recorded in Other income, net for the three-month and nine-month periods ended September 30, 2023, resulting from the change in fair value of investments in public equity securities.

(e)Accrual recorded in SG&A for the agreements in principle to resolve a previously disclosed legal matter with the DOJ, SEC and DPP. See Note 9, “Commitments and Contingencies,” for further details.

(f)Included amounts for the three-month period ended September 30, 2023 recorded in:

•SG&A - $1.8 million of separation and other severance costs to employees in Corporate and the Ketjen business which are primarily expected to be paid out during 2023, $0.7 million of facility closure expenses related to offices in Germany and $0.3 million of a loss from the sale of legacy properties not part of Albemarle’s operations.

•Other income, net - $8.2 million gain from PIK dividends of preferred equity in a Grace subsidiary and a $7.2 million gain resulting from insurance proceeds of a prior legal matter.

Included amounts for the three-month period ended September 30, 2022 recorded in:

•Cost of goods sold - $2.7 million of expense related to one-time retention payments for certain employees during the Ketjen strategic review and business unit realignment.

•SG&A - $1.9 million of expense primarily related to one-time retention payments for certain employees during the Catalysts strategic review and business unit realignment and $1.4 million primarily related to facility closure expenses of offices in Germany.

•Other income, net - $3.0 million gain from the reversal of a liability related to a previous divestiture and a $1.1 million gain resulting from the adjustment of indemnification related to previously disposed businesses.

Included amounts for the nine-month period ended September 30, 2023 recorded in:

•SG&A - $9.2 million of separation and other severance costs to employees in Corporate and the Ketjen business which are primarily expected to be paid out during 2023, $2.1 million of facility closure expenses related to offices in Germany, $1.9 million of charges primarily for environmental reserves at sites not part of our operations and $1.0 million primarily related to shortfall contributions for a multiemployer plan financial improvement plan.

•Other income, net - $10.9 million gain from PIK dividends of preferred equity in a Grace subsidiary and a $7.2 million gain resulting from insurance proceeds of a prior legal matter, partially offset by $3.9 million of a loss resulting from the adjustment of indemnification related to previously disposed businesses and $3.6 million of charges for asset retirement obligations at a site not part of our operations.

Included amounts for the nine-month period ended September 30, 2022 recorded in:

•Cost of goods sold - $2.7 million of expense related to one-time retention payments for certain employees during the Ketjen strategic review and business unit realignment and $0.5 million of expense related to the settlement of a legal matter resulting from a prior acquisition.

•SG&A - $3.4 million primarily related to facility closure expenses related to offices in Germany, $2.8 million of charges for environmental reserves at sites not part of our operations and $1.9 million of expense related to one-time retention payments for certain employees during the Catalysts strategic review and business unit realignment, partially offset by $4.3 million of gains from the sale of legacy properties not part of our operations.

•Other income, net - $3.0 million gain from the reversal of a liability related to a previous divestiture, a $1.1 million gain resulting from the adjustment of indemnification related to previously disposed businesses and a $0.6 million gain related to a settlement received from a legal matter in a prior period.