Livent Corporation

Livent reported third quarter 2023 revenue of $211 million, adjusted EBITDA of $120 million, and adjusted earnings of $0.44 per diluted share. Revenue was down 9% year over year, while adjusted EBITDA increased 8% year over year; management also said margin was roughly flat versus the prior quarter and nine percentage points higher than a year ago. Volume sold was roughly flat, with lower realized prices offset by lower overall costs. For full-year 2023, Livent now expects revenue of $890 million to $940 million and adjusted EBITDA of $500 million to $530 million, implying mid-point growth of 13% and 14% respectively versus the prior year. Management said full-year volume should be roughly flat, with minimum incremental expansion volumes in Q4, while average realized prices per LCE are still expected to be 10% to 15% higher year over year. Capital spending year-to-date was $239 million, with full-year capex still expected to be $325 million to $375 million; the company ended the quarter with $113 million in cash and no borrowings on its $500 million revolver.

Paul Graves emphasized that lithium market prices have fallen sharply, but he does not see a meaningful change in underlying demand growth or in the long-term supply-demand imbalance. He argued that current price levels are below what is rational for a durable market and said the company still expects sustainably higher lithium prices over time. Graves also framed Livent’s strategy as focused on value-added products, price discipline, and predictability, noting the company has restored a price premium versus market references and intends to keep funding growth from operating cash flow.

Gilberto Antoniazzi highlighted that Q3 adjusted EBITDA of $120 million and adjusted EPS of $0.44 came despite a 9% decline in revenue, helped by lower overall costs, lower royalties in Argentina and Chile, and lower input costs in specialty products such as butyllithium. He said year-to-date capital spending was $239 million versus adjusted cash from operations of $274 million, and reiterated full-year capex of $325 million to $375 million. He also said the balance sheet remains strong with $113 million in cash and no draw on the $500 million revolver, and that the company expects to internally fund its capacity expansions.

Analysts pressed on lithium price declines, demand destruction, and where supply is being cut; management said some Chinese non-integrated producers are shutting down, some lepidolite output has been reduced, and battery-cell destocking in China is driving much of the weakness. Questions also focused on the Argentina ramp delay, with management saying the first phase is complete but commissioning is slower than expected, so no incremental volumes will be sold in 2023. On capital needs, management said Livent expects to fund its share of Nemaska and other growth projects internally rather than use new debt or equity, and on Allkem integration it pointed to opportunities in DLE, infrastructure sharing, and future M&A in Australia.