Albemarle lifts 2022 guidance after strong Q1 lithium sales

Albemarle raised May 4 its financial performance expectations for 2022 after a first quarter where its lithium sales climbed 36% year on year on bullish price trends and strong demand.

"We achieved a strong start to the year by focusing on execution and building on the momentum we created in the second half of 2021," CEO Kent Masters said in a statement. "Many of the end markets we serve are critical for transitioning to greener energy and advancing electrification and digitalization."

In its guidance, the specialty chemicals company said it now expected total sales to reach a range of $5.2 billion to $5.6 billion in 2022, up from an initial range of $4.2 billion to $4.5 billion projected in February. The sales guidance is inclusive of its lithium, bromine and catalyst business segments. The company posted $3.3 billion in sales in 2021.

Albemarle's lithium sales in Q1 reached $550.3 million, accounting for nearly half of its total $1.13 billion in sales during the period. The company's Q1 lithium sales and total sales rose year on year by 36% and 97%, respectively.

The higher lithium sales were attributed to surging prices and the subsequent benefits realized through the company's renegotiated variable price contracts with customers.

S&P Global Commodity Insights assessed the price of seaborne lithium hydroxide at $80,000/mt CIF North Asia April 29, up sharply from $31,700/mt at the beginning of 2022 and $9,000/mt at the start of 2021.

Meanwhile, lithium carbonate on the same basis was assessed at $75,000/mt April 29, rising from $33,800/mt at the start of 2022 and from $6,350/mt at the start of 2021.

Masters said Albemarle is evaluating ongoing investments to capitalize on the rapid growth and strong pricing trends in its end markets.

"We continue to explore sustainable options to expand our conversion capacity and resources, including opportunities in North America and Europe," he said.

The Charlotte, North Carolina-based company posted a net income of $253.4 million in Q1, up from $95.7 million in Q1 2021.