Element Solutions (US:ESI)2025-02-18 21:20Financial Performance - Net sales for Q4 2024 reached $2.46 billion, a 5% increase from Q4 2023, with organic growth of 4%[5] - Reported net income for Q4 2024 was $245 million, up 107% from $118 million in Q4 2023[5] - Adjusted EBITDA for Q4 2024 was a record $535 million, reflecting an 11% increase year-over-year and a 13% increase on a constant currency basis[5] - For the full year 2024, net sales totaled $2.46 billion, a 5% increase compared to 2023, with organic net sales up 4%[10] - The company reported a GAAP diluted EPS of $1.00 for the full year 2024, compared to $0.48 in 2023[10] - Net income attributable to common stockholders for the year 2024 was $244.2 million, compared to $118.1 million in 2023, representing a 106.5% increase[18] - The company reported a net income of $244.5 million for FY 2024, with Q3 contributing $40.4 million[44] Cash Flow and Capital Management - Cash flows from operating activities for Q4 2024 were $362 million, with record free cash flow of $294 million[5] - Total net cash flows provided by operating activities for FY 2024 were $362.0 million, compared to $333.6 million in FY 2023[23] - Free cash flow for Q4 2024 was $116.4 million, compared to $95.4 million in Q4 2023[47] - Approximately $78.2 million was returned to stockholders in cash dividends for the full year 2024[11] - The company completed a $1.04 billion term loan syndication, reducing interest rates and improving balance sheet flexibility[10] Expenses and Investments - Research and development expenses for the year 2024 were $63.0 million, a decrease from $68.1 million in 2023[18] - Capital expenditures for FY 2024 totaled $68.4 million, compared to $52.7 million in FY 2023[23] - Capital expenditures for the twelve months ended December 31, 2024, totaled $68.4 million, an increase from $52.7 million in 2023, reflecting a growth of 30%[27] - The Company reported a total of $21.7 million in acquisition, divestiture, and integration expenses for FY 2024[44] Balance Sheet and Assets - Total assets decreased to $4,873.9 million in 2024 from $4,974.1 million in 2023[21] - Total liabilities decreased to $2,475.5 million in 2024 from $2,629.8 million in 2023[21] - Cash and cash equivalents increased to $359.4 million in 2024 from $289.3 million in 2023[21] - The company reported a total debt of $1,838.8 million and a cash balance of $359.4 million as of December 31, 2024[26] - The company achieved a total capitalization of $7,697.0 million as of December 31, 2024[26] - The company’s market capitalization stood at $6,217.6 million as of December 31, 2024[26] Segment Performance - Electronics segment net sales increased by 14% to $401.4 million in Q4 2024, while Industrial & Specialty segment sales grew by 1% to $222.8 million[25] - The impact of pass-through metals pricing positively affected Electronics' consolidated results by $23.6 million in Q4 2024[36] Earnings and Margins - Basic earnings per share from continuing operations for Q4 2024 was $0.23, down from $0.32 in Q4 2023[18] - The net income margin for Q4 2024 was 8.8%, down 470 basis points from 13.5% in Q4 2023[25] - Adjusted earnings per share (EPS) for Q4 2024 was $0.35, up from $0.32 in Q4 2023, representing a 9% increase[40] Future Guidance and Expectations - The company expects 2025 adjusted EBITDA guidance in the range of $520 million to $540 million, indicating potential 8% growth excluding non-operational impacts[8] - The anticipated sale of the Graphics business is expected to reduce adjusted EBITDA by approximately $30 million in 2025[3] - The company anticipates first quarter 2025 adjusted EBITDA guidance to be provided on a non-GAAP basis, reflecting ongoing operational performance expectations[30] - The effective tax rate for adjusted EPS was set at 20%, reflecting the company's long-term expectations for taxes on adjusted non-GAAP earnings[38] - The Company expects a non-GAAP effective tax rate of 20% for future periods, benefiting from U.S. tax attribute carryforwards[42] Impairments and Adjustments - The Company recorded a non-cash impairment charge of $80.0 million related to its Graphics Solutions reporting unit in Q3 2023[5] - The Company adjusted for $11.4 million impairment charge on available-for-sale debt securities in Q3 2024[7] - The company reported a goodwill impairment of $80.0 million in 2023, which was not present in 2024[18]