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Sep 30, 2023
Element Solutions Q3 2023 Earnings Report
Element Solutions reported a decrease in net sales and a net loss, but adjusted EPS remained consistent with the previous year, and adjusted EBITDA increased on a constant currency basis.
Key Takeaways
Element Solutions reported net sales of $599 million, a 3% decrease year-over-year, with a net loss of $32 million compared to a net income of $53 million in the same period last year. Adjusted EPS was $0.36, consistent with the previous year, and adjusted EBITDA increased by 2% on a constant currency basis. The company's cash flow generation remained strong, and it is on track to deliver leverage below 3.5 times by year end.
Net sales decreased by 3% to $599 million, with a similar decrease on an organic basis.
GAAP diluted loss per share was $0.13, impacted by a $0.33 charge from Graphics Solutions' goodwill impairment.
The company reported a net loss of $32 million, compared to a net income of $53 million in the same period last year.
Adjusted EPS was $0.36, consistent with the prior 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 full year 2023 adjusted EBITDA of approximately $485 million, adjusted EPS of approximately $1.30 and free cash flow of approximately $265 million.
Positive Outlook
- Ongoing focus on operational excellence.
- Accelerated customer activity for next-generation handset production.
- Strong cash flow generation.
- Durable secular growth in key portions of the business, such as electric vehicles.
- Durable secular growth in key portions of the business, such as advanced packaging applications.
Challenges Ahead
- Typical seasonal slowdown in electronics in the fourth quarter.
- Incremental foreign exchange headwind.
- Shift in order patterns from semiconductor customers due to ViaForm transaction.
- Uncertain macro environment given ongoing industrial weakness in Europe and China.
- UAW strike.
Revenue & Expenses
Visualization of income flow from segment revenue to net income