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Sep 30, 2020
Element Solutions Q3 2020 Earnings Report
Element Solutions reported a strong third quarter with robust recovery in automotive and industrially oriented businesses and continued momentum in the high-end electronics business.
Key Takeaways
Element Solutions Inc announced its Q3 2020 financial results, with net sales of $478 million, a 3% increase year-over-year. GAAP diluted income per share was $0.15, and adjusted EPS was $0.22. The company reported a net income of $36 million and adjusted EBITDA of $102 million.
Net sales increased by 3% compared to the third quarter of 2019, reaching $478 million.
GAAP diluted earnings per share was $0.15, compared to a loss per share of $0.02 in the same period last year; adjusted EPS was $0.22, compared to $0.26 in the same period last year.
Reported net income was $36 million, compared to a net loss of $6 million in the same period last year.
The company expects to pay a 5 cents per share dividend on a quarterly basis.
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 to be between $90 million and $95 million for the fourth quarter of 2020 and increased its full year 2020 free cash flow outlook to approximately $215 million.
Positive Outlook
- Adjusted EBITDA in the fourth quarter expected to be between $90 million and $95 million.
- Free cash flow forecast increased to approximately $215 million for the full year 2020.
- Megatrends driving end markets evidenced in the strength of electronics business year-to-date.
- Ability to outperform markets through sound strategic execution.
- Expect to pay a 5 cents per share dividend on a quarterly basis which equates to approximately 20% of expected annual free cash flow.
Challenges Ahead
- Expected normal seasonal slowdown.
- Impact of COVID-19 continues to make it difficult to forecast macroeconomic conditions or operating results.
- Adjusted EBITDA of $102 million, a decrease of 11% from last year on a constant currency basis
- Operating expenses exceed the baseline we expect entering 2021.
- Adjusted EBITDA margin decreased 350 basis points to 21% on a reported basis.
Revenue & Expenses
Visualization of income flow from segment revenue to net income