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Dec 31, 2020
Element Solutions Q4 2020 Earnings Report
Announced record fourth quarter and full year financial results since its launch in 2019.
Key Takeaways
Element Solutions reported a record fourth quarter in net sales and adjusted EBITDA since its launch in February 2019, driven by strong demand in its high-end electronics business and recovery in its industrially oriented businesses. Net sales increased by 18% and organic net sales increased by 10%. Adjusted EPS was $0.31, as compared to $0.22 per share in the prior year.
Net sales on a reported basis for the fourth quarter of 2020 were $537 million, an increase of 18% over the fourth quarter of 2019. Organic net sales increased 10%.
GAAP diluted EPS was $0.12, as compared to $0.29 in the same period last year.
Adjusted EPS was $0.31, as compared to $0.22 per share in the prior year.
Reported net income for the fourth quarter of 2020 was $30 million, as compared to $74 million for the fourth quarter of 2019.
Element Solutions
Element Solutions
Element Solutions Revenue by Segment
Revenue by Segment
Electronics Revenue
CapyFin.comIndustrial & Specialty Revenue
CapyFin.com Forward Guidance
For the full year 2021, the Company expects adjusted EBITDA growth of approximately 7% and adjusted EPS to be in the range of $1.10 to $1.15. Growth in the first half should be greater than the second half as we lap the negative impact of COVID, which was greatest in the second quarter of 2020. Full year free cash flow generation should be a record this year as well, providing flexibility for additional capital deployment toward some combination of prudent tuck-in acquisitions, share buybacks, and potentially increased dividends.
Positive Outlook
- Adjusted EBITDA growth of approximately 7% year-on-year
- Adjusted EPS of $1.10 to $1.15, an increase of 15% to 20%
- 2021 expected free cash flow of approximately $275 million
- Growth in the first half should be greater than the second half as we lap the negative impact of COVID, which was greatest in the second quarter of 2020
- Full year free cash flow generation should be a record this year as well, providing flexibility for additional capital deployment toward some combination of prudent tuck-in acquisitions, share buybacks, and potentially increased dividends.
Challenges Ahead
- Evolving macroeconomic factors, including general economic uncertainty, unemployment rates, and recessionary pressures
- Decreased consumer spending levels
- Reduction or changes in customer demand for the Company's products and services
- Increased operating costs (whether as a results of changes to the Company's supply chain or increases in employee costs or otherwise)
- Additional and prolonged devaluation of other countries' currencies relative to the U.S. dollar
Revenue & Expenses
Visualization of income flow from segment revenue to net income