Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
_________________________________
FORM 8-K
_________________________________
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) March 12, 2018
 
_________________________________
ALBEMARLE CORPORATION
(Exact name of Registrant as specified in charter)
_________________________________

Virginia
 
001-12658
 
54-1692118
(State or other jurisdiction
of incorporation)
 
(Commission
file number)
 
(IRS employer
identification no.)
 
 
 
 
 
4350 Congress Street, Suite 700, Charlotte, North Carolina
 
28209
(Address of principal executive offices)
 
(Zip code)
Registrant’s telephone number, including area code
(980) 299-5700
Not applicable
(Former name or former address, if changed since last report)
_________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a- 12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2)
Emerging growth company
 
¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨






Item 7.01.    Regulation FD Disclosure.
In the first quarter of 2018, the Performance Catalysts Solutions (“PCS”) product category merged with the Refining Solutions reportable segment to form a consolidated global business focused on catalysts. PCS was previously reported in the Lithium and Advanced Materials reportable segment. The new reporting structure will consist of three reportable segments: (1) Lithium, (2) Bromine Specialties and (3) Catalysts.
The new reporting structure is consistent with the manner in which information is presently used internally by the Company’s chief operating decision maker to evaluate performance and make resource allocation decisions. Each segment has a dedicated team of sales, research and development, process engineering, manufacturing and sourcing, and business strategy personnel and has full accountability for improving execution through greater asset and market focus, agility and responsiveness.
The Company is furnishing this Current Report on Form 8-K to reflect certain historical annual and quarterly segment information for the two year period ending December 31, 2017, corresponding with the Company’s new reporting structure. A copy of this information is being furnished as Exhibit 99.1 hereto. The changes in reporting structure discussed above affect the manner in which the results of the Company’s reportable segments were previously reported. This Current Report on Form 8-K does not reclassify or restate the Company’s previously reported consolidated financial statements for any period. It should be noted that Adjusted EBITDA is a financial measure that is not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”). These measures are presented here to provide additional useful measurements to review our operations, provide transparency to investors and enable period-to-period comparability of financial performance. A reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated and reported in accordance with GAAP, is also included in this Current Report on Form 8-K. Additionally, the information presented in this Current Report on Form 8-K does not reflect events occurring after the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, and should be read in conjunction with the Company’s previously filed Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and the Company’s subsequent filings with the Securities and Exchange Commission.
The information in this Current Report on Form 8-K, including Exhibit 99.1, is furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.


Item 9.01.    Financial Statements and Exhibits.

(d) Exhibits.

99.1    Supplemental historical information, issued by the Company.





SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: March 12, 2018

ALBEMARLE CORPORATION
By:
/s/ Scott A. Tozier
 
Scott A. Tozier
 
Executive Vice President and Chief Financial Officer






EXHIBIT INDEX

Exhibit
 
 
Number
 
Exhibit
 
 
 
 



Exhibit

Exhibit 99.1
Albemarle Corporation and Subsidiaries
Consolidated Summary of Segment Results
(In Thousands) (Unaudited)

The Company’s chief operating decision maker uses earnings before interest, taxes, depreciation and amortization, as adjusted on a consistent basis for certain non-recurring or unusual items such as acquisition and integration related costs, utilization of inventory markup, gains or losses on sales of businesses, restructuring charges, facility divestiture charges, non-operating pension and OPEB items and other significant non-recurring items (“adjusted EBITDA”), in a balanced manner and on a segment basis to assess the ongoing performance of the Company’s business segments and to allocate resources. In addition, management uses adjusted EBITDA for business planning purposes and as a significant component in the calculation of performance-based compensation for management and other employees. The Company has reported adjusted EBITDA because management believes it provides transparency to investors and enables period-to-period comparability of financial performance. Adjusted EBITDA is a financial measure that is not required by, or presented in accordance with, U.S. GAAP. Adjusted EBITDA should not be considered as an alternative to Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reported in accordance with U.S. GAAP, or any other financial measure reported in accordance with U.S. GAAP.
 
Three months ended
 
Year ended
 
March 31, 2017
 
June 30, 2017
 
September 30, 2017
 
December 31, 2017
 
December 31, 2017
Net sales:
 
 
 
 
 
 
 
 
 
Lithium
$
216,229

 
$
243,821

 
$
269,238

 
$
289,597

 
$
1,018,885

Bromine Specialties
219,191

 
203,945

 
212,923

 
219,084

 
855,143

Catalysts
253,558

 
258,255

 
244,594

 
311,165

 
1,067,572

All Other
32,419

 
30,704

 
28,021

 
37,770

 
128,914

Corporate
666

 
533

 
90

 
173

 
1,462

Total net sales
$
722,063

 
$
737,258


$
754,866


$
857,789


$
3,071,976

 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA:
 
 
 
 
 
 
 
 
 
Lithium
$
99,852

 
$
115,200

 
$
112,944

 
$
118,656

 
$
446,652

Bromine Specialties
68,488

 
62,075

 
63,936

 
64,402

 
258,901

Catalysts
69,749

 
67,427

 
60,394

 
86,313

 
283,883

All Other
5,156

 
2,444

 
306

 
5,972

 
13,878

Corporate
(31,869
)
 
(28,205
)
 
(28,197
)
 
(29,563
)
 
(117,834
)
Total adjusted EBITDA
$
211,376

 
$
218,941


$
209,383


$
245,780


$
885,480



1


 
Three months ended
 
Year ended
 
March 31, 2016
 
June 30, 2016
 
September 30, 2016
 
December 31, 2016
 
December 31, 2016
Net sales:
 
 
 
 
 
 
 
 
 
Lithium
$
136,560

 
$
157,713

 
$
166,406

 
$
208,173

 
$
668,852

Bromine Specialties
196,553

 
206,863

 
194,496

 
194,513

 
792,425

Catalysts
250,192

 
253,652

 
264,471

 
263,186

 
1,031,501

All Other
72,089

 
50,626

 
28,272

 
30,001

 
180,988

Corporate
1,817

 
473

 
365

 
782

 
3,437

Total net sales
$
657,211

 
$
669,327


$
654,010


$
696,655


$
2,677,203

 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA:
 
 
 
 
 
 
 
 
 
Lithium
$
63,834

 
$
64,146

 
$
68,637

 
$
89,097

 
$
285,714

Bromine Specialties
61,608

 
66,562

 
51,807

 
46,949

 
226,926

Catalysts
77,714

 
80,108

 
88,042

 
70,745

 
316,609

All Other
8,464

 
876

 
5,470

 
(38
)
 
14,772

Corporate
(19,587
)
 
(21,221
)
 
(25,627
)
 
(19,369
)
 
(85,804
)
Total adjusted EBITDA
$
192,033

 
$
190,471


$
188,329


$
187,384


$
758,217

    
See below for a reconciliation of adjusted EBITDA on a segment basis, the non-GAAP financial measure, from Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reporting in accordance with U.S. GAAP. For additional explanation of the adjustments from Net income attributable to Albemarle Corporation to adjusted EBITDA, see the Company’s previously furnished on Form 8-K, under Item 2.02, for the periods presented.
 
Lithium
 
Bromine Specialties
 
Catalysts
 
Reportable Segments Total
 
All Other
 
Corporate
 
Consolidated Total
Three months ended March 31, 2017:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
77,614

 
$
58,694

 
$
56,966

 
$
193,274

 
$
3,246

 
$
(145,307
)
 
$
51,213

Depreciation and amortization
19,065

 
9,794

 
12,783

 
41,642

 
$
1,910

 
1,518

 
45,070

Utilization of inventory markup
10,606

 

 

 
10,606

 

 

 
10,606

Restructuring and other

 

 

 

 

 
12,905

 
12,905

Gain on acquisition
(7,433
)
 

 

 
(7,433
)
 

 

 
(7,433
)
Acquisition and integration related costs

 

 

 

 

 
14,281

 
14,281

Interest and financing expenses

 

 

 

 

 
68,513

 
68,513

Income tax expense

 

 

 

 

 
11,971

 
11,971

Non-operating pension and OPEB items

 

 

 

 

 
(1,063
)
 
(1,063
)
Other

 

 

 

 

 
5,313

 
5,313

Adjusted EBITDA
$
99,852


$
68,488


$
69,749


$
238,089


$
5,156


$
(31,869
)

$
211,376

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended March 31, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
44,346

 
$
51,853

 
$
65,295

 
$
161,494

 
$
130,709

 
$
(64,017
)
 
$
228,186

Depreciation and amortization
19,488

 
9,755

 
12,419

 
41,662

 
612

 
1,335

 
43,609

(Gain) loss on sales of businesses, net

 

 

 

 
(122,857
)
 
1,533

 
(121,324
)
Acquisition and integration related costs

 

 

 

 

 
18,558

 
18,558

Interest and financing expenses

 

 

 

 

 
15,114

 
15,114

Income tax expense

 

 

 

 

 
25,485

 
25,485

Income from discontinued operations (net of tax)

 

 

 

 

 
(17,312
)
 
(17,312
)
Non-operating pension and OPEB items

 

 

 

 

 
(283
)
 
(283
)
Adjusted EBITDA
$
63,834


$
61,608


$
77,714


$
203,156


$
8,464


$
(19,587
)

$
192,033


2


 
Lithium
 
Bromine Specialties
 
Catalysts
 
Reportable Segments Total
 
All Other
 
Corporate
 
Consolidated Total
Three months ended June 30, 2017:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
81,819

 
$
51,739

 
$
53,994

 
$
187,552

 
$
152

 
$
(84,371
)
 
$
103,333

Depreciation and amortization
21,460

 
10,336

 
13,433

 
45,229

 
$
2,292

 
1,601

 
49,122

Utilization of inventory markup
11,921

 

 

 
11,921

 

 

 
11,921

Restructuring and other

 

 

 

 

 
4,235

 
4,235

Acquisition and integration related costs

 

 

 

 

 
6,479

 
6,479

Interest and financing expenses

 

 

 

 

 
14,590

 
14,590

Income tax expense

 

 

 

 

 
23,130

 
23,130

Non-operating pension and OPEB items

 

 

 

 

 
(1,053
)
 
(1,053
)
Multiemployer plan shortfall contributions

 

 

 

 

 
4,940

 
4,940

Other

 

 

 

 

 
2,244

 
2,244

Adjusted EBITDA
$
115,200

 
$
62,075

 
$
67,427

 
$
244,702

 
$
2,444

 
$
(28,205
)
 
$
218,941

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 30, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
42,129

 
$
56,747

 
$
67,223

 
$
166,099

 
$
(1,503
)
 
$
(479,417
)
 
$
(314,821
)
Depreciation and amortization
22,017

 
9,815

 
12,885

 
44,717

 
3,353

 
1,635

 
49,705

(Gain) loss on sales of businesses, net

 

 

 

 
(974
)
 

 
(974
)
Acquisition and integration related costs

 

 

 

 

 
19,030

 
19,030

Interest and financing expenses

 

 

 

 

 
15,800

 
15,800

Income tax expense

 

 

 

 

 
23,656

 
23,656

Loss from discontinued operations (net of tax)

 

 

 

 

 
398,340

 
398,340

Non-operating pension and OPEB items

 

 

 

 

 
(265
)
 
(265
)
Adjusted EBITDA
$
64,146

 
$
66,562

 
$
80,108

 
$
210,816

 
$
876

 
$
(21,221
)
 
$
190,471


3


 
Lithium
 
Bromine Specialties
 
Catalysts
 
Reportable Segments Total
 
All Other
 
Corporate
 
Consolidated Total
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
568

 

 

 
568

 

 

 
568

Gain on acquisition
1,408

 

 

 
1,408

 

 

 
1,408

Acquisition and integration related costs

 

 

 

 

 
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

 

 

 

 

 
1,646

 
1,646

Other
(1,093
)
 

 
(1,250
)
 
(2,343
)
 

 
645

 
(1,698
)
Adjusted EBITDA
$
112,944

 
$
63,936

 
$
60,394

 
$
237,274

 
$
306

 
$
(28,197
)
 
$
209,383

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended September 30, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
46,848

 
$
41,621

 
$
75,299

 
$
163,768

 
$
3,806

 
$
(39,354
)
 
$
128,220

Depreciation and amortization
21,789

 
10,186

 
12,743

 
44,718

 
1,664

 
1,592

 
47,974

Acquisition and integration related costs

 

 

 

 

 
6,749

 
6,749

Interest and financing expenses

 

 

 

 

 
15,946

 
15,946

Income tax expense

 

 

 

 

 
12,394

 
12,394

Income from discontinued operations (net of tax)

 

 

 

 

 
(23,185
)
 
(23,185
)
Non-operating pension and OPEB items

 

 

 

 

 
(231
)
 
(231
)
Other

 

 

 
 
 

 
462

 
462

Adjusted EBITDA
$
68,637

 
$
51,807

 
$
88,042

 
$
208,486

 
$
5,470

 
$
(25,627
)
 
$
188,329


4


 
Lithium
 
Bromine Specialties
 
Catalysts
 
Reportable Segments Total
 
All Other
 
Corporate
 
Consolidated Total
Three months ended December 31, 2017:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
93,814

 
$
54,646

 
$
71,859

 
$
220,319

 
$
3,899

 
$
(442,584
)
 
$
(218,366
)
Depreciation and amortization
25,038

 
9,756

 
14,454

 
49,248

 
2,073

 
1,520

 
52,841

Restructuring and other

 

 

 

 

 
(85
)
 
(85
)
Gain on acquisition
(196
)
 

 

 
(196
)
 

 

 
(196
)
Acquisition and integration related costs

 

 

 

 

 
7,559

 
7,559

Interest and financing expenses

 

 

 

 

 
16,455

 
16,455

Income tax expense

 

 

 

 

 
378,221

 
378,221

Non-operating pension and OPEB items

 

 

 

 

 
(12,981
)
 
(12,981
)
Multiemployer plan shortfall contributions

 

 

 

 

 
1,301

 
1,301

Note receivable reserve

 

 

 

 

 
28,730

 
28,730

Other

 

 

 

 

 
(7,699
)
 
(7,699
)
Adjusted EBITDA
$
118,656

 
$
64,402

 
$
86,313

 
$
269,371

 
$
5,972

 
$
(29,563
)
 
$
245,780

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended December 31, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
65,529

 
$
37,143

 
$
57,599

 
$
160,271

 
$
(1,711
)
 
$
443,530

 
$
602,090

Depreciation and amortization
23,568

 
9,806

 
13,146

 
46,520

 
1,673

 
1,494

 
49,687

Acquisition and integration related costs

 

 

 

 

 
13,047

 
13,047

Interest and financing expenses

 

 

 

 

 
18,321

 
18,321

Income tax expense

 

 

 

 

 
34,728

 
34,728

Income from discontinued operations (net of tax)

 

 

 

 

 
(559,974
)
 
(559,974
)
Non-operating pension and OPEB items

 

 

 

 

 
26,368

 
26,368

Other

 

 

 

 

 
3,117

 
3,117

Adjusted EBITDA
$
89,097

 
$
46,949

 
$
70,745

 
$
206,791

 
$
(38
)
 
$
(19,369
)
 
$
187,384


5


 
Lithium
 
Bromine Specialties
 
Catalysts
 
Reportable Segments Total
 
All Other
 
Corporate
 
Consolidated Total
Year ended December 31, 2017:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
342,992

 
$
218,839

 
$
230,665

 
$
792,496

 
$
5,521

 
$
(743,167
)
 
$
54,850

Depreciation and amortization
87,879

 
40,062

 
54,468

 
182,409

 
8,357

 
6,162

 
196,928

Utilization of inventory markup
23,095

 

 

 
23,095

 

 

 
23,095

Restructuring and other

 

 

 

 

 
17,056

 
17,056

Gain on acquisition
(6,221
)
 

 

 
(6,221
)
 

 

 
(6,221
)
Acquisition and integration related costs

 

 

 

 

 
33,954

 
33,954

Interest and financing expenses

 

 

 

 

 
115,350

 
115,350

Income tax expense

 

 

 

 

 
431,817

 
431,817

Non-operating pension and OPEB items

 

 

 

 

 
(16,125
)
 
(16,125
)
Multiemployer plan shortfall contributions

 

 

 

 

 
7,887

 
7,887

Note receivable reserve

 

 

 

 

 
28,730

 
28,730

Other
(1,093
)
 

 
(1,250
)
 
(2,343
)
 

 
502

 
(1,841
)
Adjusted EBITDA
$
446,652

 
$
258,901

 
$
283,883

 
$
989,436

 
$
13,878

 
$
(117,834
)
 
$
885,480

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year ended December 31, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss) attributable to Albemarle Corporation
$
198,852

 
$
187,364

 
$
265,416

 
$
651,632

 
$
131,301

 
$
(139,258
)
 
$
643,675

Depreciation and amortization
86,862

 
39,562

 
51,193

 
177,617

 
7,302

 
6,056

 
190,975

(Gain) loss on sales of businesses, net

 

 

 

 
(123,831
)
 
1,533

 
(122,298
)
Acquisition and integration related costs

 

 

 

 

 
57,384

 
57,384

Interest and financing expenses

 

 

 

 

 
65,181

 
65,181

Income tax expense

 

 

 

 

 
96,263

 
96,263

Income from discontinued operations (net of tax)

 

 

 

 

 
(202,131
)
 
(202,131
)
Non-operating pension and OPEB items

 

 

 

 

 
25,589

 
25,589

Other

 

 

 

 

 
3,579

 
3,579

Adjusted EBITDA
$
285,714

 
$
226,926

 
$
316,609

 
$
829,249

 
$
14,772

 
$
(85,804
)
 
$
758,217


6