Albemarle to reduce headcount, lower spending on contracted services

Albemarle outlined a series of measures underway to re-phase its organic growth investments and optimize its cost structure in response to changing end-market conditions, particularly in the lithium value chain. Albemarle expects its 2024 capital expenditures to be in the range of $1.6B to $1.8B, down from approximately $2.1B in 2023. This new level of spending reflects a re-phasing of larger projects in the near term to focus on those that are significantly progressed, near completion and in startup. Decisions made by the company include to: commission the Meishan lithium conversion facility, which reached mechanical completion at the end of 2023; complete commissioning activities for Trains 1 and 2 at the Kemerton lithium conversion facility and focus construction on Train 3;prioritize permitting activities at the Kings Mountain spodumene resource and defer spending at the Richburg mega-flex lithium conversion facility;defer investment for the Albemarle Technology Park in North Carolina;and limit sustaining capital spending to the most critical health, safety, environmental, and site maintenance projects.The company is also pursuing actions to optimize its cost structure, reducing costs by approximately $95M annually, primarily related to sales, general, and administrative expenses, including a reduction in headcount and lower spending on contracted services. Albemarle expects to realize more than $50M of these cost savings in 2024 and to pursue additional cash management actions primarily related to working capital. Related to the actions announced today, Albemarle will record a charge in the first quarter of 2024, primarily associated with severance and related benefit costs, exit and disposal activities, and asset write-downs.