Albemarle Reports Record Fourth Quarter and Record Full Year 2011 Results

Tuesday, Jan 24, 2012

Albemarle Corporation (NYSE: ALB) reported fourth quarter 2011 earnings of $99.4 million, or $1.11 per share, compared to fourth quarter 2010 earnings of $85.0 million, or $0.92 per share.  The Company reported net sales of $707.4 million in the fourth quarter of 2011 compared to net sales of $605.0 million in the fourth quarter of 2010.

Earnings for the full year 2011 were $436.3 million, or $4.77 per share, compared to $323.7 million, or $3.51 per share, for 2010.  Excluding the $7.0 million ($4.6 million after tax, or 5 cents per share) charge for restructuring costs in the first quarter of 2010, earnings for 2010 were $328.3 million, or $3.56 per share.  Net sales for 2011 were $2.9 billion compared to$2.4 billion for 2010. 

"We are very pleased to report strong fourth quarter results which capped a record year at Albemarle during which each of our business segments recorded the highest revenue and profitability in our history," said Luke Kissam, President and CEO.  "Despite a challenging operating environment in the second half of the year, we grew revenue by 21% to $2.9 billionand earnings by 34% to $4.77 per share.  We closed the year with a very strong balance sheet, which gives us the financial flexibility to fund growth opportunities.  These results, which are a credit to the strength of our businesses and the innovation of our employees, put us on track to achieve our Vision 2015 goals."

Quarterly Segment Results

Catalysts generated net sales of $289.5 million in the fourth quarter of 2011, a 25 percent increase over net sales in the fourth quarter of 2010, due mainly to favorable pricing.  Catalysts segment income was $83.6 million in the fourth quarter of 2011, up 43 percent over fourth quarter 2010 results of $58.5 million due primarily to favorable pricing gains while partly offset mainly by higher input costs and lower equity income versus the fourth quarter of 2010. 

Polymer Solutions delivered net sales of $209.3 million in the fourth quarter of 2011, a 5 percent decrease over net sales in the fourth quarter of 2010, with favorable impacts from pricing and foreign currency being offset overall by lower volumes.  Segment income for Polymer Solutions was $36.6 million in the fourth quarter of 2011, a 28 percent decline from $51.0 million in the fourth quarter of 2010, due primarily to lower volumes and higher input costs, partly offset by favorable pricing.

Fine Chemistry net sales in the fourth quarter of 2011 were $208.5 million, a 36 percent increase over net sales in the fourth quarter of 2010, due mainly to favorable volumes and pricing.  Segment income for Fine Chemistry was $42.6 million for the fourth quarter of 2011, over 60 percent higher than fourth quarter 2010 results of $26.3 million, due primarily to favorable pricing and volume performance, partly offset by higher input costs and higher charges attributable to noncontrolling interests.

Corporate and Other

Corporate and other expense for the fourth quarter and year ended December 31, 2011 was $24.6 million and $97.5 million, respectively.  The increase over the comparable periods in 2010 was due primarily to higher personnel-related costs including performance-based incentive compensation and pension costs. 

Interest and financing expenses were $9.0 million for the fourth quarter of 2011 compared to $7.5 million for the fourth quarter of 2010, with this increase due primarily to higher average interest rates on outstanding borrowings during the 2011 period.

Our fourth quarter and full year 2011 effective income tax rates were 23.3 percent and 23.6 percent, respectively.  Our effective tax rate continues to be influenced by the level and geographic mix of income and benefits from a favorable mix of income in lower tax jurisdictions. 

Cash Flow

Our cash flow from operations was approximately $490 million for the full year 2011, and we had $469.4 million in cash and cash equivalents at December 31, 2011.  During 2011, cash on hand and cash provided by operations funded capital expenditures for plant, machinery and equipment of approximately $198.0 million (which includes approximately $40.0 million in capital expenditures associated with our Jordan Bromine joint venture), long-term debt repayments of $109.6 million, pension and postretirement contributions of $59.8 million, dividends to shareholders of $57.8 million and repurchases of $178.1 million of our common stock. 

Outlook

In the second half of 2011, the global economic uncertainty contributed to conservative cash management and lower demand in certain supply chains, and this was particularly true in our Polymer Solutions segment.  How long that uncertainty will last is not clear at this time.  However, our businesses remain healthy, and we believe the end markets we serve may stabilize or accelerate in the second half of 2012.

Earnings Call

The Company's performance for the fourth quarter and the year ended December 31, 2011 will be discussed on a conference call at 8:00 AM Eastern Standard time on January 24, 2012.  The call can be accessed by dialing 800-901-5217 (International Dial In # 617-786-2964), and entering conference ID 62911660.  The Company's earnings presentation and supporting material can be accessed through Albemarle's website under Investors at www.albemarle.com.

About Albemarle

Albemarle Corporation, headquartered in Baton Rouge, Louisiana, is a leading global developer, manufacturer and marketer of highly-engineered specialty chemicals for consumer electronics, petroleum refining, utilities, packaging, construction, automotive/transportation, pharmaceuticals, crop protection, food-safety and custom chemistry services.  Albemarle is committed to global sustainability and is continuing to advance its eco-practices and solutions in its three business segments, Polymer Solutions, Catalysts and Fine Chemistry, with Corporate Responsibility Magazine naming Albemarle among its prestigious "100 Best Corporate Citizens" list for 2011.  Albemarle employs approximately 4,000 people and serves customers in approximately 100 countries.  Albemarle regularly posts information to www.albemarle.com, including notification of events, news, financial performance, investor presentations and webcasts, Regulation G reconciliations, SEC filings and other information regarding the Company, its businesses and markets served. 

SOURCE Albemarle Corporation