Arcadium Lithium Reports 2024 Financial Results Amid Pending Acquisition by Rio Tinto
Arcadium Lithium plc, a prominent player in the lithium industry, has released its financial results for the fourth quarter and full year of 2024. The report comes at a pivotal time for the company, as it continues with its pending acquisition by global mining giant Rio Tinto, announced on October 9, 2024. Due to the nature of the acquisition, Arcadium Lithium has opted not to hold an earnings conference call and has withdrawn its previous financial guidance for 2025.
Transaction Impact and Earnings Call Update
As a result of the acquisition by Rio Tinto, Arcadium Lithium has refrained from offering its usual earnings conference call, which is customary during such corporate transactions. Additionally, the company has withdrawn its prior operating and financial guidance, providing no new projections for the upcoming year. Shareholders and stakeholders seeking further details on Arcadium Lithium’s performance are encouraged to refer to the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which is being filed with the Securities and Exchange Commission (SEC).
Fourth Quarter Performance Overview
In the fourth quarter of 2024, Arcadium Lithium reported revenue of $289.0 million. Despite challenges in the market, the company managed to achieve a reported attributable GAAP net loss of $14.2 million, or 1 cent per diluted share. The company’s adjusted EBITDA for the quarter stood at $73.7 million, showing a notable improvement from the previous quarter, reflecting higher volumes across all lithium products, coupled with reduced costs. However, this was partly offset by a decrease in average realized pricing across most of its lithium products.
The fourth quarter saw a 56% increase in total volumes sold on a lithium carbonate equivalent (LCE) basis compared to the third quarter, though volumes remained relatively flat compared to the previous year. This increase is attributed to customers fulfilling their contractual commitments and meeting demand during the active year-end period in key end markets.
Lithium Product Pricing and Volumes in Q4
Arcadium Lithium’s pricing trends varied across its product lines during the fourth quarter. The company realized an average price of $15,700 per product metric ton for combined lithium hydroxide and carbonate volumes, which represents a slight decline from $16,200 in the previous quarter. The pricing for most lithium products, with the exception of spodumene concentrate, declined due to weaker market conditions. Despite this, lithium hydroxide pricing remained relatively stable quarter-over-quarter, benefiting from favorable customer mix and existing long-term commercial agreements.
Here’s a breakdown of key lithium products for Q4 2024:
- Lithium Hydroxide and Lithium Carbonate: Revenue of $211.1 million, with approximately 13,450 product metric tons sold at an average price of $15,700 per product metric ton.
- Butyllithium & Other Lithium Specialties: Revenue of $38.9 million, with approximately 470 LCE sold at $82,800 per LCE.
- Spodumene Concentrate: Revenue of $39.0 million, with approximately 54,100 dry metric tons sold at $721 per dry metric ton (approximately $810 SC6 equivalent).
Full Year Financial Highlights
For the full year of 2024, Arcadium Lithium reported total revenue of $1,007.8 million. The company posted an attributable GAAP net income of $103.2 million, or 9 cents per diluted share. Adjusted EBITDA for the year amounted to $324.5 million, and adjusted earnings per share were 14 cents per diluted share.
Arcadium Lithium’s total volumes sold for the year were slightly lower on an LCE basis, with a decline in spodumene sales due to reduced production at its Mt Cattlin mine. However, sales of combined lithium carbonate and hydroxide volumes helped offset this decline. On average, realized pricing across all lithium products was lower in 2024 compared to the previous year, reflecting the weaker market environment.
Pricing and Volumes for the Full Year
Here’s a detailed overview of Arcadium Lithium’s performance for the full year of 2024:
- Lithium Hydroxide and Lithium Carbonate: Revenue of $728.9 million, with approximately 42,300 product metric tons sold at an average price of $17,200 per product metric ton.
- Butyllithium & Other Lithium Specialties: Revenue of $169.2 million, with approximately 1,860 LCE sold at $91,000 per LCE.
- Spodumene Concentrate: Revenue of $109.7 million, with approximately 140,000 dry metric tons sold at $784 per dry metric ton (approximately $880 SC6 equivalent).
CEO’s Remarks on 2024 Performance
Paul Graves, President and CEO of Arcadium Lithium, commented on the company’s performance in 2024, highlighting the challenges posed by broader market conditions. Despite these obstacles, Arcadium Lithium focused on executing key operational initiatives, such as cost management and operational discipline, while maintaining flexibility to adapt to rapidly changing market dynamics. Graves also pointed to the company’s strong customer relationships and its strategy of securing long-term contracts, which helped achieve higher realized pricing compared to a fully market-based pricing approach.
Looking ahead, Graves expressed confidence in Arcadium Lithium’s future growth, particularly with the company’s plans to leverage its portfolio of assets and expansion projects. The CEO emphasized that the impending combination with Rio Tinto would provide the company with the resources and scale needed to accelerate this growth, benefitting customers, employees, and communities in the process.
Acquisition by Rio Tinto: Transaction Timeline
Arcadium Lithium’s planned acquisition by Rio Tinto has been a major development for the company. The Transaction Agreement, which was announced on October 9, 2024, details Rio Tinto’s all-cash offer to acquire Arcadium Lithium for US$5.85 per share.
The requisite shareholder approval for the acquisition was obtained at a special meeting on December 23, 2024. Since then, Arcadium Lithium has made significant progress in securing the necessary regulatory approvals for the deal. As of February 13, 2025, the company has received all pre-closing regulatory approvals in key jurisdictions, including Australia, Canada, China, Japan, South Korea, the United Kingdom, and the United States. This includes approvals for merger control clearance and investment screening.
The Transaction is now slated for closing on March 6, 2025, with the final closing contingent upon a court order from the Royal Court of Jersey and other customary closing conditions. Arcadium Lithium has indicated that while it is targeting the March closing date, there can be no assurance that the transaction will be completed on time or on the terms set out in the agreement.
Conclusion and Future Outlook
Arcadium Lithium’s 2024 results reflect a year of operational focus amid challenging market conditions. While the company faces some short-term pricing challenges, its long-term strategy, including securing long-term contracts and leveraging a high-quality portfolio, positions it well for future growth. The upcoming acquisition by Rio Tinto is set to play a pivotal role in accelerating this growth and expanding Arcadium Lithium’s capabilities.
With the deal set to close in early March 2025, the future looks promising for Arcadium Lithium, as it transitions to being part of a larger, more diversified global mining company. Investors and stakeholders will continue to monitor developments closely as the Transaction progresses toward completion.
About Arcadium Lithium
Arcadium Lithium is a leading global lithium chemicals producer committed to safely and responsibly harnessing the power of lithium to improve people’s lives and accelerate the transition to a clean energy future. We collaborate with our customers to drive innovation and power a more sustainable world in which lithium enables exciting possibilities for renewable energy, electric transportation and modern life.
Arcadium Lithium is vertically integrated, with industry-leading capabilities across lithium extraction processes, including hard-rock mining, conventional brine extraction and direct lithium extraction (DLE), and in lithium chemicals manufacturing for high performance applications. We have operations around the world, with facilities and projects in Argentina, Australia, Canada, China, Japan, the United Kingdom and the United States. For more information, please visit us at www.ArcadiumLithium.com.
