NYSE$ESI

Element Solutions Inc · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

Announced third quarter financial results, demonstrating growth in net sales and adjusted EPS.

Element Solutions Inc reported a strong third quarter with net sales of $616 million, a 29% increase year-over-year. Adjusted EPS rose to $0.35 from $0.22 in the prior year period. The company raised its full-year 2021 adjusted EBITDA guidance to a range of $515 million to $525 million and adjusted EPS to greater than $1.35.

  • Net sales increased by 29% to $616 million, with organic net sales up by 13%.
  • GAAP diluted EPS was $0.15, while adjusted EPS increased to $0.35.
  • Net income remained unchanged at $36 million.
  • Free cash flow was $81 million for the quarter.

Headline financials

Total Revenue

$616M

Previous: $478M+29.0%
EPS (adj)

$0.35

Previous: $0.22+59.1%
Total Organic Net Sales Growth

13.0%

Previous: -2.0%+750.0%
Electronics Organic Net Sales Growth

11.0%

Previous: 2.0%+450.0%
Capital Expenditures

-$27.7M

Previous: -$21.7M-27.6%
Free Cash Flow

$8.3M

Previous: $14.3M-42.0%
Net Income

$36M

Previous: $36M+0.0%
Operating Income

$68.5M

Previous: $58.6M+16.9%
Gross Profit

$245M

Previous: $204M+20.1%
Cash & Equivalents

$279M

Previous: $248M+12.4%
Total Assets

$5.18B

Previous: $4.33B+19.8%
Stock-Based Comp

$12.5M

Previous: $2M+525.0%

Revenue & EPS history

Element Solutions · Revenue · Quarterly

$616M

Q3 2021+29%vs Q3 2020
Beat estimate in 15 of 16 quarters(94%)
ActualEstimate

Revenue by segment

Element Solutions · $617M total across 2 segments · Q3 2021

  • Electronics
    $399M+30.0%
  • Specialties
    $218M+27.5%

Forward guidance

The Company updated its full-year 2021 guidance and now expects adjusted EBITDA in the range of $515 million to $525 million, and adjusted EPS of greater than $1.35. In addition, the Company expects fourth quarter 2021 adjusted EBITDA to be approximately $118 million and full-year 2021 free cash flow of at least $265 million.

Tailwinds

  • Full-year 2021 adjusted EBITDA guidance raised to $515 million to $525 million.
  • Full-year 2021 adjusted EPS expected to be greater than $1.35.
  • Fourth quarter 2021 adjusted EBITDA expected to be approximately $118 million.
  • Full-year 2021 free cash flow expected to be at least $265 million.
  • Expectations are for robust growth in 2022.

Headwinds

  • Supply chain environment is problematic.
  • There is turbulence in the automotive market.
  • Fourth quarter is traditionally slower than the third quarter.
  • Headwinds from supply chain disruptions are expected.
  • Automotive market is weaker.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2021

Historical avgQ3 2021

+0.1%

Avg return

Earnings day

+1.7%

Avg return

5 days after

+1.3%

Avg return

30 days after

52%

26 / 50 earnings

Positive

+14.9%

Q3 2016

Best reaction

-9.9%

Q2 2015

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.5%+10.3%+9.4%
Q4 2025+4.2%+11.9%-3.9%
Q3 2025+0.7%+3.4%-1.1%
Q1 2025+7.2%+5.3%+11.3%
Q4 2024+4.4%-0.5%-4.4%
Q3 2024+2.7%+0.9%+5.6%
Q2 2024-3.1%-6.6%-2.6%
Q1 2024-3.0%-0.1%-0.4%
Q4 2023-3.6%-2.0%+3.2%
Q3 2023-0.3%-0.8%+12.3%
Q2 2023+3.6%+5.4%+1.6%
Q1 2023+1.7%+4.5%+6.0%
Q4 2022+1.1%+2.0%-8.8%
Q3 2022-1.2%-2.7%+10.0%
Q2 2022+2.4%+4.9%+1.6%
Q1 2022+5.4%+1.9%+5.3%
Q4 2021-1.4%+4.4%-6.2%
Q3 2021+0.4%+0.9%+6.7%
Q2 2021+0.6%+0.9%+0.7%
Q1 2021+4.4%+6.6%+13.8%
Q4 2020-3.4%+5.1%+4.0%
Q3 2020-6.9%-4.2%+14.0%
Q2 2020-2.4%-0.6%-4.9%
Q1 2020+1.1%+3.1%+10.2%
Q4 2019-3.0%+0.5%-24.8%
Q3 2019+2.2%+3.3%-3.4%
Q2 2019+1.3%+1.3%+0.1%
Q1 2019+3.4%+2.9%-12.9%
Q4 2018-4.6%-2.9%-14.7%
Q3 2018+1.0%+1.7%+8.8%
Q2 2018+0.7%+1.8%+9.0%
Q1 2018+1.0%+1.9%+17.7%
Q4 2017-1.2%+2.7%-8.9%
Q3 2017-2.0%-1.6%-9.5%
Q2 2017-7.4%-9.3%-16.2%
Q1 2017-2.3%-2.0%-7.5%
Q4 2016+1.3%-0.2%-1.5%
Q3 2016+14.9%+18.9%+28.4%
Q2 2016-2.8%-5.5%+1.2%
Q1 2016+8.9%
Q4 2015-1.3%
Q3 2015-6.6%
Q2 2015-9.9%
Q1 2015-5.8%
Q4 2014-3.5%
Q3 2014+1.5%
Q2 2014+4.4%
Q1 2014+3.6%
Q4 2013-0.4%
Q3 2013-2.1%
Q2 2013
Q1 2013
Q4 2012
Q3 2012

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