Element Solutions 2024: Record Earnings & Strategic Moves- Intellectia AI™

# Record Earnings and Strategic Moves Highlight Element Solutions Inc.'s 2024 Performance - Element Solutions Inc Earnings Report

Element Solutions Inc, a global specialty chemicals company, has delivered impressive financial results for the fiscal year ending December 31, 2024. The company has not only achieved record earnings and growth in key segments but also made strategic portfolio optimizations that set the stage for sustainable success. This report offers a detailed review of their earnings, segment performance, key developments, and prospects for the coming year.

## Element Solutions Inc Earnings Overview

Element Solutions Inc reported a remarkable year with its net sales reaching $2.46 billion, marking a 5% increase compared to 2023. The company almost doubled its reported net income to $245 million, up from $118 million the previous year. These achievements reflect a 107% increase in net income on a reported basis. The company also realized a record Adjusted EBITDA of $535 million, a growth of 11% compared to 2023 and 13% when adjusted for constant currency.

## Financial Results

Below is a summary of key financial metrics for Element Solutions Inc.:

| Metrics                     | 2024 Actual  | 2023 Actual | Year-over-Year Change |
|-----------------------------|--------------|-------------|-----------------------|
| Net Sales (in billions)     | $2.46        | $2.34       | +5%                   |
| Reported Net Income (in millions) | $245        | $118       | +107%                 |
| Adjusted EBITDA (in millions) | $535        | $482       | +11%                  |
| GAAP Diluted EPS            | $1.00        | $0.48       | +108%                 |
| Adjusted EPS                | $1.44        | $1.29       | +11%                  |

### Fourth Quarter 2024 Highlights 

| Metrics                      | Q4 2024      | Q4 2023  | Year-over-Year Change |
|------------------------------|------------|-----------|-----------------------|
| Net Sales (in millions)      | $624       | $572     | +9%                   |
| Reported Net Income (in millions) | $55        | $77      | -29%                  |
| Adjusted EBITDA (in millions) | $130      | $120     | +8%                   |
| GAAP Diluted EPS            | $0.23      | $0.32    | -28%                  |
| Adjusted EPS                | $0.35      | $0.32    | +9%                   |

## Revenue Breakdown by Segment

Element Solutions Inc. operates through two primary segments: Electronics and Industrial & Specialty. The segments demonstrated varied performance dynamics, contributing to overall growth.

| Segment                  | Net Sales 2024 (in millions) | Net Sales 2023 (in millions) | Year-over-Year Change |
|--------------------------|--------------------|----------------------|-----------------------|
| Electronics              | $1,560             | $1,418               | +10%                  |
| Industrial & Specialty   | $896              | $924                | -3%                   |

### Electronics Segment Analysis

The Electronics segment achieved a commendable 10% increase in net sales, contributing $1.56 billion in 2024. This growth stems largely from the rising demand in electronics consumables, power electronics solution
s, and the company's penetration in high-value industries like EV and high-performance computing.

### Industrial & Specialty Segment Analysis

The Industrial & Specialty division faced challenges, with net sales decreasing by 3% to $896 million. Organic sales also fell by 1%, but the segment maintained a steady Adjusted EBITDA increase of 5%, reflecting operational efficiencies and targeted investments.

## Key Developments

One of the most significant strategic moves by Element Solutions is the decision to sell its MacDermid Graphics Solutions, a key business unit, for approximately $325 million. This collaborative move aligns with the company's goal to focus on higher-growth niches within the specialty chemicals market. The sale is expected to close in Q1 2025, providing greater flexibility on the company's balance sheet and enabling opportunities for value-adding capital allocation.

The company also improved its financial position by completing a successful debt refinancing in October 2024. Syndicating $1.04 billion of new term loans allowed for an interest rate reduction and the repayment of $1.14 billion in existing loans, thereby improving the company's credit outlook and liquidity position.

## Comments from Company Officers

President and Chief Executive Officer Benjamin Gliklich expressed optimism about the future: “Element Solutions had an outstanding year in 2024. We produced record results, improved our portfolio and positioned the company for longer-term outperformance. We have been successful in penetrating some of the fastest-growing, highest-value niches in the electronics consumables market. The anticipated closing of the Graphics business sale this quarter will improve the overall portfolio and its longer-term growth rate.”

## Dividends and Share Repurchases

Element Solutions Inc.'s Board of Directors declared a cash dividend of $0.08 per outstanding share, to be paid on March 17, 2025. The company returned approximately $78.2 million to stockholders in 2024 in dividends, reflecting a balanced capital allocation strategy.

## Stock Forecast

Given the robust performance in 2024 and strategic initiatives, Element Solutions Inc appears positioned for steady growth in 2025. The introduced guidance for 2025 aims at an Adjusted EBITDA of between $520 million and $540 million, considering potential impacts from foreign exchange and the divestiture of the Graphics business. The stock price is projected to rise, with a high expectation based on continued margin expansion and revenue growth from thriving niche segments within the electronics industry. A low threshold might involve unexpected market disruptions or slower-than-expected recovery in industrial markets. The stock price projections could vary between $12-$15, contingent on market conditions and execution of their strategic plans.



Element Solutions Inc has successfully navigated through 2024's challenges, laying a strong foundation for continued growth. The decisions made throughout the year reflect a commitment to optimizing operations and capitalizing on high-growth opportunities. As the company transitions into 2025, it remains well-poised to advance its leadership in the specialty chemicals sector.