Q1 2024 Earnings Presentation
May 7, 2024
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements made in this presentation are forward- looking statements that are based on our current views and assumptions regarding future events, future business conditions and the outlook for our company based on currently available information. In some cases, you can identify these forward-looking statements by such words or phrases as "outlook", "will likely result," "is confident that," "expect," "expects," "should," "could," "may," "will continue to," "believe," "believes," "anticipates," "predicts," "forecasts," "estimates," "projects," "potential," "intends" or similar expressions identifying "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including the negative of those words or phrases. Such forward- looking statements are based on our current views and assumptions regarding future events, future business conditions and the outlook for the company based on currently available information. The forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. These statements are qualified by reference to the risk factors included in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Form 10-K"), the section captioned "Forward-Looking Information" in Part II of the 2023 Form 10-K and to similar risk factors and cautionary statements in all other reports and forms filed with the Securities and Exchange Commission ("SEC"). We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Forward-looking statements are qualified in their entirety by the above cautionary statement. We specifically decline to undertake any obligation, and specifically disclaims any duty, to publicly update or revise any forward- looking statements that have been made to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as may be required by law.
Non-GAAP Financial Terms
These slides contain certain "non-GAAP financial terms". Such non-GAAP financial terms include adjusted EBITDA, adjusted EPS,
adjusted tax rate, adjusted cash from operations, free cash flow ("FCF"), organic revenue growth and return on invested capital. Definitions of these terms, as well as a reconciliation to the most directly comparable financial measure calculated and presented in accordance with GAAP, are provided on our website investors.fmc.com. Although we provide forecasts for these non-GAAP financial measures, we are not able to forecast the most directly comparable measures calculated and presented in accordance with GAAP. Certain elements of the composition of the GAAP amounts are not predictable, making it impractical for us to forecast. Such elements include, but are not limited to restructuring, acquisition charges, and discontinued operations and related cash activity. As a result, no GAAP outlook is provided. All references herein to "EBITDA" are shorthand references to Adjusted EBITDA and do not signify EBITDA before adjustments.
Q1 2024 Earnings Presentation | FMC CORPORATION | 2 | |
Q1 2024 Results
Q1 2024 | Q1 2023 | 2024 VS. 2023 | |
Revenue | $918 | $1,344 | (32)% |
GAAP Net Income (Loss) | $(3) | $196 | (102)% |
Adjusted EBITDA1 | $161 | $362 | (56)% |
% Revenue | 17.5% | 26.9% | (940) bps |
GAAP EPS | $(0.02) | $1.55 | (101)% |
Adjusted EPS1 | $0.36 | $1.77 | (80)% |
Note: Amounts in millions of USD except for EPS
Q1 2024 HIGHLIGHTS
- Lower volume in all regions as channel seeks to achieve and maintain lower inventory levels
- NPI2 and Plant Health sales both out-performed overall portfolio
- Branded diamide growth in LATAM
- 4% price decline driven by LATAM and Asia
- Lower costs included benefits from restructuring
- Steady application rates by growers
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 3 | |
2. | NPI (New Product Introductions) launched in last five years |
Q1 2024 Regional Revenue Drivers
Revenue down 31% organically1
REGIONAL REVENUE BRIDGE | North | $259 million | Latin | $188 million | ||||||||||||
America | (-48% YOY, | America | (-20% YOY, | |||||||||||||
-48%ex-FX) | -22%ex-FX) | |||||||||||||||
• Lower volume versus record- | • Price decline in mid-teens, mostly in | |||||||||||||||
breaking prior-year performance | Brazil | |||||||||||||||
• | Price essentially flat | • Double digit growth in branded | ||||||||||||||
• Solid growth in fungicides including | diamides | |||||||||||||||
Xyway® (flutriafol) and Adastrio® | • Lower volumes including returns in | |||||||||||||||
REGIONAL REVENUE BRIDGE (ex-FX) | (fluindapyr) | Argentina | ||||||||||||||
• Premio® Star insecticide and Onsuva® | ||||||||||||||||
fungicide driving NPI2 growth | ||||||||||||||||
Asia | $164 million | EMEA | $307 million | |||||||||||||
(-29% YOY, | (-20% YOY, | |||||||||||||||
-28%ex-FX) | -17%ex-FX) | |||||||||||||||
Note: Amounts in millions of USD | • | Lower volumes primarily driven by | • Lower volume including registration | |||||||||||||
China partially offset by growth in | removals and rationalization of | |||||||||||||||
Q1 2024 REVENUE DRIVERS | ||||||||||||||||
ANZ | some lower margin products | |||||||||||||||
• Destocking in India channel | • Low-single digit price increase | |||||||||||||||
VOLUME | PRICE | FX | continues | • Solid growth in France, Poland, Italy | ||||||||||||
• NPI2 sales essentially flat with | and Spain | |||||||||||||||
Total: -32% | -27% | -4% | -1% | significant increase in percent of | • Adverse weather in UK and | |||||||||||
sales | northern Europe | |||||||||||||||
Organic1: | -31% | |||||||||||||||
• | High-single digit price decrease | |||||||||||||||
4 | ||||||||||||||||
1. Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation Q1 2024 Earnings Presentation | FMC CORPORATION | |||||||||||||||
2. NPI (New Product Introductions) launched in last five years
Q1 2024 Adjusted EBITDA1 Drivers
Adjusted EBITDA1 down 56%
Adjusted EBITDA1 BRIDGE
Note: Amounts in millions of USD
KEY DRIVERS AT A GLANCE
Volume, Mix, Launches
- Lower volume in all regions due to channel destocking and purchases delayed to closer to the timing of application
- NPI2 and branded diamides each out-performed overall portfolio
Cost
- Strong contribution from restructuring actions
- Lower input costs more than offset unabsorbed fixed costs
Price | FX | |||||||
• 4% price decline as higher pricing in Europe was more than | • | Modest FX tailwind | ||||||
offset by price declines in LATAM and Asia | ||||||||
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 5 | ||||
2. | NPI (New Product Introductions) launched in last five years |
Global Restructure and Cost Reduction Plan
Company tracking to deliver 2024 expected savings net of inflation to operating costs
$50 - $75 million in 2024 (net savings vs. 2023) | $150 million by end of 2025 (run rate savings) | |||||
OPERATING MODEL CHANGES | REDUCE SPEND | DIVEST | ||||
NON-CORE ASSETS | ||||||
ACTIONS | STATUS | ACTIONS | STATUS | ACTION | STATUS | |
• Right size Brazil organization | • Stop / defer non-essential | • Sales process | ||||
spend | continues for non- | |||||
• | Voluntary Separation | crop Global | ||||
Program (U.S.) | • Assess and redefine global | Specialty Solutions | ||||
(GSS) business | ||||||
location strategy | ||||||
• | Additional workforce | |||||
reductions through operating | • Re-evaluate and implement |
model changes | |
sourcing strategy | |
Initiative in early stages Initiative completed
Q1 2024 Earnings Presentation | FMC CORPORATION | 6 | |
Q2 2024 Financial Outlook
Q2 2023
Q2 2024 Guidance
REVENUE DRIVERS
REVENUE | $1.02 |
billion
$1.00 billion - $1.15 billion
+6% YoY
- Volume growth across all regions except Asia
- Mid-singledigit pricing pressure
- Minor FX headwind
- Strong growth from new products including Coragen® eVo insecticide in Argentina and the U.S., Premio® Star insecticide in Brazil and Adastrio® fungicide in the U.S.
1 | |
EBITDA | $188 |
ADJ. | million |
$170 million -
$210 million
+1% YoY
- Higher volumes
- Lower price
- Minor FX tailwind
ADJ. EBITDA1 DRIVERS
- Lower operating costs from restructuring
- Favorable input costs more than offset by other COGS headwinds
ADJ. EPS1,2 DRIVERS
EPS1,2 | $0.50 |
ADJ. |
$0.43 - $0.72
+15% YoY
• Flat adjusted EBITDA1 | • Slightly higher tax rate |
- Lower interest expense and D&A
Note: Year-over-year growth noted at mid-point of guidance range | |||||
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 7 | |
2. | Outlook for EPS assumes weighted average diluted shares outstanding (WADSO) of 125.5 million | ||||
FY 2024 Financial Outlook Update
FY 2023
REVENUE | $4.49 |
billion
FY 2024 Guidance
$4.50 billion - $4.70 billion
+2.5% YoY
REVENUE DRIVERS | |||
• | Market conditions expected to improve as year | • | High channel inventory in India expected to be |
progresses | headwind for duration of year | ||
• | Strong growth from NPI3 | • | Minor FX headwind |
- Low-singledigit pricing pressure with largest impact in H1
1 | |
EBITDA | $978 |
ADJ. | million |
EPS1,2 | $3.78 |
ADJ. | |
$900 million - $1.05 billion
Flat YoY
$3.23 - $4.41
+1% YoY
- Volume growth driven by NPI3
- Lower price
- Minor FX tailwind
- Flat adjusted EBITDA1
- Lower interest expense and D&A
ADJ. EBITDA1 DRIVERS
- Net restructuring cost savings of $50 million to $75 million
- COGS headwinds
ADJ. EPS1,2 DRIVERS
- Slightly higher tax rate
Note: Year-over-year growth noted at mid-point of guidance range | |||||
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 8 | |
2. | Outlook for EPS assumes weighted average diluted shares outstanding (WADSO) of 125.5 million | ||||
3. | NPI (New Product Introductions) launched in last five years |
Volume and Cost Actions Expected to Deliver Adjusted EBITDA1 Growth in H2
H2 REVENUE
$2.13
billion
H2 2023
+$0.5 billion (+23%) YoY
• Expect improving market conditions • Pricing in line with prior year as year progresses
- NPI2 expected to contribute significantly to volume growth
+$195 million (+46%) YoY
$2.61
billion
H2 2024
H2 ADJ. EBITDA1
$429
million
H2 2023
- Sales volume increase including sales growth in new products
- Operating cost benefits from global restructuring
- COGS headwinds most pronounced in Q3
$624
million
H2 2024
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 9 | |
2. | NPI (New Product Introductions) launched in last five years | ||||
Note: Outlook numbers are mid-points of guidance ranges
Potential Range of Outcomes for 2024 Adjusted
EBITDA1
UPSIDE
MID-POINT
DOWNSIDE
$1.05
billion
$975
million
$900
million
- Outsized improvement in market conditions in H2
- Stronger than expected NPI2 growth
- Above high end of restructuring benefits
- Channel destocking well-advanced by end of H1
- Improving market conditions in H2
- Modest headwind in price largely in H1
- Flat raw material cost
- Restructuring benefits between $50M - $75M
- Minor FX headwind
- Slower improvement in market conditions in H2
- Raw material inflation
- Moderate headwind in price for full year
1. | Denotes non-GAAP financial term. Refer to non-GAAP financial terms at the beginning of this presentation | Q1 2024 Earnings Presentation | FMC CORPORATION | 10 | |
2. | NPI (New Product Introductions) launched in last five years | ||||
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FMC Corporation published this content on 06 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 06 May 2024 20:44:02 UTC.