Element Solutions Inc. (NYSE: ESI), a global leader in specialty chemicals, has announced its financial results for the second quarter and first half of 2024, ending June 30.
Executive Commentary
President and CEO Benjamin Gliklich stated, “Element Solutions achieved remarkable performance this quarter. Despite a modest rebound in consumer electronics and sluggish global industrial markets, our earnings growth accelerated. This success was driven by robust demand in high-performance computing, data centers, and semiconductor fabrication. These high-value sectors contributed to an improved product mix and, coupled with declining raw material prices, led to significant margin expansion. The evolving electronics industry is opening up new high-value opportunities that we are well-positioned to exploit. Our markets are expanding rapidly, and our strategic positioning allows us to benefit significantly from this growth. This quarter reflects the results of several years of strong strategy execution and margin improvement.”
Gliklich added, “We have recently revised our adjusted EBITDA guidance to a range of $530 million to $545 million, representing approximately 15% constant currency growth at the midpoint. While electronics markets are improving, they remain near their low points compared to long-term trends. If the broader electronics market continues to recover and mobile phone demand picks up, we anticipate our full-year adjusted EBITDA will surpass the midpoint of this range. We foresee a multi-year recovery in electronics and, given our solid strategic foundation, we are confident in achieving record earnings in the coming years.”
Second Quarter 2024 Highlights (versus Q2 2023)
- Net sales for Q2 2024 were $613 million, up 5% from Q2 2023, with a 4% increase in organic net sales.
- Electronics: Net sales rose 10% to $392 million, with a 7% increase in organic net sales.
- Industrial & Specialty: Net sales fell 4% to $221 million, with a 1% decrease in organic net sales.
- Earnings per share (EPS) for Q2 2024:
- GAAP diluted EPS: $0.38, up from $0.11.
- Adjusted EPS: $0.36, compared to $0.31.
- Reported net income for Q2 2024 was $93 million, a 213% increase from $30 million.
- Net income margin rose by 1,010 basis points to 15.2%.
- Adjusted EBITDA for Q2 2024 reached $135 million, a 16% increase from $116 million in Q2 2023. On a constant currency basis, adjusted EBITDA grew 21%.
- Electronics: Adjusted EBITDA was $92 million, up 21%, with a 26% increase on a constant currency basis.
- Industrial & Specialty: Adjusted EBITDA was $43 million, up 7%, with a 12% increase on a constant currency basis.
- Adjusted EBITDA margin improved by 230 basis points to 22.1%, with a 250 basis point increase on a constant currency basis.
