AT A GLANCE: Livent earnings fall 66% in Q1 on lower lithium prices, Covid-19 impact

In brief:

• The company’s adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) were down by 66% year on year in the first quarter to $9.4 million due to lower lithium prices and volumes sold against a backdrop of the negative impact of Covid-19 in Asian markets.
• All Livent’s facilities are operational including the company’s Argentinian sites which were shut for two weeks during the first quarter to comply with the local government’s lockdown measures.
• Livent withdrew its previously issued full-year 2020 guidance due to uncertainty surrounding economic consequences of Covid-19. The company had previously issued an Ebitda guidance of $60-85 million and 26,500-28,500 tonnes of lithium carbonate equivalent (LCE) for 2020.
• In March, the company announced the suspension of all capital expansion globally to maintain financial flexibility in the near term.

Key quotes – president and chief executive officer Paul Graves

• “Despite the challenging near-term environment, we have not seen any evidence of automotive OEMs pulling back from their own electrification objectives. In fact, we have seen certain OEMs use this as an opportunity to strengthen their engagement within the electric vehicle supply chain.”
• “With that said, we do expect near-term demand to be negatively impacted by the production stoppages we have seen at OEM facilities globally.”
• “On the supply side, the lithium industry has reacted swiftly to declining market prices with producers and resource developers announcing output reductions and delays or cancellations of capacity expansion projects. We believe these actions will create a more rapid tightening of the supply-demand balance once electric vehicle production starts to accelerate.”