Element Solutions Inc Reports Third Quarter 2024 Financial Results
Element Solutions Inc (NYSE: ESI), a global specialty chemicals company, announced its financial results for the third quarter ending September 30, 2024.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | YoY % Change | Consensus Estimates | Variance to Estimates |
|---|---|---|---|---|---|
| Total Revenue | $645M | N/A | 8% | $626.46M | +$18.54M |
| Net Income | $40M | -$32M | N/A | N/A | N/A |
| Earnings Per Share (EPS) | $0.39 | $0.36 | 8.33% | $0.38 | +$0.01 |
| Adjusted EBITDA | $143M | $134M | 6% | N/A | N/A |
Element Solutions reported strong financial performance in Q3 2024 with an 8% increase in net sales to $645 million, $18.54 million above consensus estimates. Adjusted earnings per share (EPS) exceeded expectations at $0.39, marking an 8.33% growth from the previous year. The company also registered an increase in adjusted EBITDA by 6% to $143 million.
Revenue Performance by Segment
| Segment | Q3 2024 | Q3 2023 | YoY % Change | Organic Growth |
|---|---|---|---|---|
| Electronics | $419M | N/A | 14% | 9% |
| Industrial & Specialty | $226M | N/A | -3% | Flat |
The Electronics segment experienced robust growth, with net sales rising by 14% to $419 million, driven by advancements in technology trends like advanced packaging and high-performance computing. The Industrial & Specialty segment faced challenges, showing a 3% decline in revenue, although the organic net sales remained flat, indicating resilience given the market backdrop.
Key Developments and Operational Highlights
- MacDermid Graphics Solutions Sale : The company plans to sell its flexographic printing plate business, MacDermid Graphics Solutions, for approximately $325 million. The sale is expected to be completed by mid-2025.
- Debt Reduction : Element Solutions successfully syndicated $1.04 billion in new term loans, reducing interest rates and borrowing under its credit agreement by $100 million.
Executive Commentary
CEO Benjamin Gliklich highlighted the company's strategic achievements, focusing on capitalizing on technological trends within the Electronics segment and maintaining profitability under challenging macroeconomic conditions for its Industrial & Specialty business. He noted the company's ongoing portfolio repositioning, such as the pending sale of the MacDermid Graphics business, which aims to concentrate on core market areas.
Forward Guidance
Element Solutions narrowed its full-year 2024 adjusted EBITDA guidance to a range of $535 million to $540 million, suggesting another potential record in earnings performance.
Stock Price Movement Post-Earnings
Following the earnings announcement, Element Solutions' stock price experienced a decline of approximately 1.09%.
The results underscore Element Solutions' ability to navigate a complex market environment while focusing on strategic growth initiatives. The continued investment in emerging technology trends positions the company well to achieve sustained growth into 2025.
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