Icahn Enterprises(IEP) - 2025 Q1 - Quarterly Results

Financial Performance Summary Q1 2025 financial performance declined significantly, marked by reduced revenues, widened net loss, negative Adjusted EBITDA, and a reduced quarterly dividend Q1 2025 Key Financial Results Icahn Enterprises reported a significant downturn in its first quarter 2025 financial performance compared to the same period in 2024. Revenues decreased from $2.5 billion to $1.9 billion. The company swung from an Adjusted EBITDA of $134 million to an Adjusted EBITDA loss of $287 million, and the net loss attributable to the company widened substantially from $38 million to $422 million Q1 2025 vs Q1 2024 Financial Comparison | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $1.9 billion | $2.5 billion | | Net Loss Attributable to IEP | $422 million | $38 million | | Net Loss per Depositary Unit | $0.79 | $0.09 | | Adjusted EBITDA Attributable to IEP | ($287 million) | $134 million | Indicative Net Asset Value (NAV) The company's indicative net asset value (NAV) decreased by $336 million to approximately $3.0 billion as of March 31, 2025, compared to December 31, 2024. This decline was primarily driven by a $224 million loss in the Investment segment, with notable losses in the healthcare sector - Indicative Net Asset Value stood at approximately $3.0 billion as of March 31, 2025, marking a decrease of $336 million from December 31, 2024[5] - The decrease in NAV was mainly due to losses of $224 million in the Investment segment, driven by underperformance in the healthcare sector[3] Dividend Declaration The Board of Directors declared a quarterly distribution of $0.50 per depositary unit for the first quarter of 2025. This represents a 50% reduction from the $1.00 per unit distribution in the same quarter of the previous year. Unitholders have the option to receive the distribution in cash or additional units - A quarterly distribution of $0.50 per depositary unit was declared on May 5, 2025, payable around June 25, 2025, to unitholders of record on May 19, 2025[4][5] - Unitholders can elect to receive their distribution in either cash or additional depositary units by June 12, 2025. The default option is additional units[4] Distribution per LP Unit Comparison | Period | Distribution per LP Unit | | :--- | :--- | | Q1 2025 | $0.50 | | Q1 2024 | $1.00 | Consolidated Financial Statements This section details Q1 2025 consolidated financial statements, highlighting significant revenue decrease, widened net loss, and a decline in total assets and equity Condensed Consolidated Statements of Operations For the first quarter ended March 31, 2025, total revenues were $1.87 billion, a decrease from $2.47 billion in the prior-year period. The company experienced a significant net loss from investment activities of $394 million. Consequently, the net loss attributable to Icahn Enterprises widened to $422 million, or $0.79 per unit, compared to a $38 million loss, or $0.09 per unit, in Q1 2024 Condensed Consolidated Statements of Operations (in millions, except per unit amounts) | | Three Months Ended March 31, | | :--- | :---: | :---: | | | 2025 | 2024 | | Revenues | $1,867 | $2,470 | | Net sales | $2,002 | $2,253 | | Net loss from investment activities | ($394) | ($96) | | Total Expenses | $2,521 | $2,489 | | Cost of goods sold | $2,016 | $1,991 | | Net loss | ($580) | ($26) | | Less: net (loss) income attributable to non-controlling interests | ($158) | $12 | | Net loss attributable to Icahn Enterprises | ($422) | ($38) | | Basic and Diluted loss per LP unit | ($0.79) | ($0.09) | Condensed Consolidated Balance Sheets As of March 31, 2025, Icahn Enterprises' total assets stood at $15.48 billion, down from $16.28 billion at the end of 2024. This was accompanied by a slight increase in total liabilities to $11.74 billion. The decline in assets and rise in liabilities resulted in a decrease in total equity attributable to Icahn Enterprises from $2.47 billion to $1.77 billion Condensed Consolidated Balance Sheets (in millions) | | March 31, 2025 | December 31, 2024 | | :--- | :---: | :---: | | ASSETS | | | | Cash and cash equivalents | $2,183 | $2,603 | | Investments | $2,073 | $2,310 | | Total Assets | $15,481 | $16,279 | | LIABILITIES AND EQUITY | | | | Debt | $6,794 | $6,809 | | Total Liabilities | $11,739 | $11,658 | | Equity attributable to Icahn Enterprises | $1,774 | $2,466 | | Total Equity | $3,742 | $4,621 | | Total Liabilities and Equity | $15,481 | $16,279 | Non-GAAP Financial Measures and Reconciliations This section explains the company's use of non-GAAP measures like EBITDA, Adjusted EBITDA, and Indicative Net Asset Value, detailing their definitions, limitations, and GAAP reconciliations Use of Non-GAAP Financial Measures (EBITDA & Adjusted EBITDA) The company utilizes non-GAAP measures, specifically EBITDA and Adjusted EBITDA, to supplement its GAAP financial results. Management believes these metrics offer a clearer view of core operating performance by excluding items like interest, taxes, depreciation, amortization, and other non-operational charges. However, the company also acknowledges the limitations of these measures, such as not reflecting cash expenditures for capital assets or debt service, and advises they should not be considered in isolation - The company defines Adjusted EBITDA as EBITDA excluding effects of impairment, restructuring, transformation costs, certain pension expenses, gains/losses on asset disposition, and other non-operational charges[12] - Management uses these non-GAAP measures to assess operating results and believes they help investors evaluate core performance without the distortion of certain accounting and financing-related items[13] - The company cautions that EBITDA and Adjusted EBITDA have limitations and should not be seen as substitutes for U.S. GAAP results, as they do not reflect cash requirements for capital expenditures, working capital, or interest payments[14][16] Use and Calculation of Indicative Net Asset Value (NAV) IEP presents an indicative net asset value (NAV) as a supplementary tool for investors, calculated at $3.0 billion as of March 31, 2025, down from $3.34 billion at year-end 2024. The company stresses that this is not a formal valuation, does not represent the market price of its units, and is of limited use. The calculation is based on the market value of certain subsidiaries and investments, GAAP equity for others, and management's fair-value estimates for real estate assets - The company uses indicative NAV as an additional method for valuing its assets but warns that it does not represent the trading price of depositary units and should be considered with caution[17][18] Indicative Net Asset Value (in millions) | | March 31, 2025 | December 31, 2024 | | :--- | :---: | :---: | | Total market-valued subsidiaries and investments | $3,825 | $3,966 | | Operating Business Indicative Gross Asset Value | $6,385 | $6,536 | | Add: Holding Company cash and cash equivalents | $1,318 | $1,397 | | Less: Holding Company debt | ($4,699) | ($4,699) | | Indicative Net Asset Value | $3,001 | $3,337 | Reconciliation of Net Loss to Adjusted EBITDA For Q1 2025, the company reconciled its GAAP net loss attributable to IEP of $422 million to a non-GAAP Adjusted EBITDA loss of $287 million. This compares to Q1 2024, where a net loss of $38 million was reconciled to a positive Adjusted EBITDA of $134 million. Key adjustments in Q1 2025 included adding back net interest expense, depreciation, and impairment charges Reconciliation of Net loss attributable to IEP to Adjusted EBITDA (in millions) | | Three Months Ended March 31, | | :--- | :---: | :---: | | | 2025 | 2024 | | Net loss attributable to IEP | ($422) | ($38) | | Interest expense, net | $83 | $63 | | Income tax (benefit) expense | ($56) | $3 | | Depreciation and amortization | $79 | $86 | | EBITDA attributable to IEP | ($316) | $114 | | Impairment | $9 | - | | Restructuring costs | $6 | - | | Loss on disposition of assets, net | $2 | $5 | | Transformation costs | $8 | $11 | | Other | $4 | $6 | | Adjusted EBITDA attributable to IEP | ($287) | $134 |