Lithium Industry Predators Albemarle 2016 Lithium Sales Of Nearly 300 Million US Dollars Business

- Mar 04, 2017-

Albemarle Corporation (NYSE: ALB) issued a quarterly and annual report of 2016, of which, lithium business growth significantly, the annual sales of lithium business net sales of 286 million US dollars, accounting for 37.7% of its total sales, mainly Due to the global new energy automotive industry development rate beyond the market expected to bring the demand for lithium ore due to Qi Sheng.

Data show that Albemarle is a listed chemical company in the United States, in the lithium business, the early 2016 ALB and FMC, SQM tied for the world's three major lithium mining giant, its 2016 acquisition of two well-known domestic lithium salt manufacturers - Jiangxi Lithium and Sichuan Guorun, the expansion of lithium salt production capacity.

Tianfeng Securities provided Yabao 2016 annual report data show that 2016 annual net sales of 2.68 billion US dollars, adjusted EBITDA of 758 million US dollars, of which lithium business contribution of 286 million dollars (37.7%). Annual sales of lithium increased by 31% in 2016, adjusted EBITDA profit margin of 43%, adjusted EBITDA increased by 34%. 2016 trading volume increased by 18%, pricing improved by 14%. Basically all the amount of growth and most of the pricing improvements are contributed by the battery grade products.

At the same time, the quarterly report of 2016, the fourth quarter total revenue of 697 million US dollars, of which lithium business sales of 208 million US dollars (accounting for 29.8% of total revenue), higher than market expectations of 170 million US dollars, the business contribution EBITDA 89 million US dollar, higher than the market forecast of 74 million US dollars, adjusted EBITDA rose 56% year on year. From the annual report, Albemarle a few pieces of business, lithium compound business growth the fastest.


Source: Company Annual Report, Tianfeng Securities Research Institute

At present, Yalu lithium salt orders sufficient, 80% of the lithium salt production business companies have signed the current 2-5 years of long-term contract to do protection. The company will continue to expand lithium production capacity, its capacity in Jiangxi Salt Lake will be expanded from the original 1w tons to 3.5-4w tons, the total capacity of lithium salt in the next decade to more than 16w tons, but also further from the upstream verification to the global market EV The demand for the rapid increase.


Source: Company Annual Report, Tianfeng Securities Research Institute

It is reported that Albemarle in the domestic acquisition of two lithium salt manufacturers existing capacity of 15,000 tons per year, plans to 2018, an additional expansion of 2-2.5 million tons of production capacity.

In Chile, Albemarle and Chilean Economic Development Organization signed a lithium salt mining rights agreement, the company was authorized to 2043 years ago, the annual production of 80,000 tons of lithium carbonate; and Albemarle plans to complete by 2020 the third battery lithium carbonate Factories; Chile's current capacity of 24,000 tons per year, by 2020 will achieve 80,000 tons per year of production capacity.

In addition, the company in Argentina made an exclusive mining rights, and the acquisition of some lithium salt resources. The current data show that Albemarle acquisition of lithium salt resources for the current territory of Argentina's largest salt lake. The company is still studying the situation of the Salt Lake, is expected within a year or two to a specific business plan.


Source: Company Annual Report, Tianfeng Securities Research Institute

Albemarle is expected, compared with 2016, 2017 capital expenditure should be a substantial increase. The company will increase the investment of La Negra 3, which is the third lithium carbonate plant in Chile, which is scheduled to start in early 2020 and begin to expand capacity of 20,000 to 25,000 tons for Jiangxi Jiang Li. By 2021, Albemarle plans to produce more than 160,000 tons of lithium carbonate.

Based on the prospects for the lithium business, Albemarle is expected in 2017 annual sales are expected to 28-29.5 billion US dollars, EBITDA is expected to 8-8.4 billion US dollars. Which lithium-related business is expected to grow over 20%.