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Jun 30, 2020
Element Solutions Q2 2020 Earnings Report
Announced second quarter financial results, demonstrating resilience in challenging conditions.
Key Takeaways
Element Solutions reported a 15% decrease in net sales to $387 million, but managed to preserve adjusted EBITDA margin and grow free cash flow year-over-year. The company's profit and cash flow exceeded expectations due to solid execution and resilience in high-end electronics markets.
Net sales decreased by 15% year-over-year on a reported and organic basis, reaching $387 million.
GAAP diluted EPS was $0.01, while adjusted EPS was $0.18, compared to $0.21 in the same period last year.
Net income was reported at $2 million, a decrease from $15 million in the prior year.
Free cash flow was $61 million for the quarter and $111 million for the first half of the year.
Element Solutions
Element Solutions
Element Solutions Revenue by Segment
Revenue by Segment
Electronics Revenue
CapyFin.comIndustrial & Specialty Revenue
CapyFin.com Forward Guidance
The Company expects adjusted EBITDA in the third quarter of at least $80 million and full year 2020 free cash flow to exceed $185 million.
Positive Outlook
- Expect adjusted EBITDA in the third quarter of at least $80 million.
- Full year 2020 free cash flow is expected to exceed $185 million.
- Actively evaluating compelling tuck-in acquisitions.
- Plan to continue to deploy strong cash flow to compound growth in earnings per share.
- Targeting a net leverage ratio below 3.5x adjusted EBITDA.
Challenges Ahead
- Economic uncertainty.
- Unknowable nature of extended or renewed COVID-19-related supply chain disruptions.
- Potential for broader economic impacts.
- Difficult to forecast macroeconomic conditions.
- Difficult to forecast operating results.
Revenue & Expenses
Visualization of income flow from segment revenue to net income