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Segment Information | 3 Months Ended
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Mar. 31, 2019
Segment Reporting [Abstract] |
Reportable Segments | Segment Information: Our three reportable segments include: (1) Lithium; (2) Bromine Specialties; and (3) Catalysts. Each segment has a dedicated team of sales, research and development, process engineering, manufacturing and sourcing, and business strategy personnel and has full accountability for improving execution through greater asset and market focus, agility and responsiveness. This business structure aligns with the markets and customers we serve through each of the segments. This structure also facilitates the continued standardization of business processes across the organization, and is consistent with the manner in which information is presently used internally by the Company’s chief operating decision maker to evaluate performance and make resource allocation decisions. Summarized financial information concerning our reportable segments is shown in the following tables. The “All Other” category includes only the fine chemistry services business that does not fit into any of our core businesses. The Corporate category is not considered to be a segment and includes corporate-related items not allocated to the operating segments. Pension and OPEB service cost (which represents the benefits earned by active employees during the period) and amortization of prior service cost or benefit are allocated to the reportable segments, All Other, and Corporate, whereas the remaining components of pension and OPEB benefits cost or credit (“Non-operating pension and OPEB items”) are included in Corporate. Segment data includes intersegment transfers of raw materials at cost and allocations for certain corporate costs. The Company’s chief operating decision maker uses adjusted EBITDA (as defined below) to assess the ongoing performance of the Company’s business segments and to allocate resources. The Company defines adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, as adjusted on a consistent basis for certain non-recurring or unusual items in a balanced manner and on a segment basis. These non-recurring or unusual items may include acquisition and integration related costs, gains or losses on sales of businesses, restructuring charges, facility divestiture charges, non-operating pension and OPEB items and other significant non-recurring items. In addition, management uses adjusted EBITDA for business planning purposes and as a significant component in the calculation of performance-based compensation for management and other employees. The Company has reported adjusted EBITDA because management believes it provides transparency to investors and enables period-to-period comparability of financial performance. Adjusted EBITDA is a financial measure that is not required by, or presented in accordance with, U.S. GAAP. Adjusted EBITDA should not be considered as an alternative to Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reported in accordance with U.S. GAAP, or any other financial measure reported in accordance with U.S. GAAP.
| Three Months Ended March 31,
| 2019 |  | 2018
| (In thousands)
Net sales: |  |  |
Lithium | $ | 291,886 |  |  | $ | 298,032 |
Bromine Specialties | 249,052 |  |  | 225,639 |
Catalysts | 251,648 |  |  | 260,717 |
All Other | 39,478 |  |  | 37,165 |
Corporate | — |  |  | 76 |
Total net sales | $ | 832,064 |  |  | $ | 821,629 |
Adjusted EBITDA: |  |  |
Lithium | $ | 115,616 |  |  | $ | 131,014 |
Bromine Specialties | 78,597 |  |  | 69,969 |
Catalysts | 60,071 |  |  | 67,830 |
All Other | 7,243 |  |  | 3,862 |
Corporate | (35,660 | ) |  | (23,957 | )
Total adjusted EBITDA | $ | 225,867 |  |  | $ | 248,718 |
See below for a reconciliation of adjusted EBITDA, the non-GAAP financial measure, from Net income attributable to Albemarle Corporation, the most directly comparable financial measure calculated and reported in accordance with U.S. GAAP (in thousands):
| Lithium |  | Bromine Specialties |  | Catalysts |  | Reportable Segments Total |  | All Other |  | Corporate |  | Consolidated Total
Three months ended March 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) attributable to Albemarle Corporation | $ | 93,169 |  |  | $ | 67,480 |  |  | $ | 47,859 |  |  | $ | 208,508 |  |  | $ | 5,206 |  |  | $ | (80,145 | ) |  | $ | 133,569 |
Depreciation and amortization | 22,092 |  |  | 11,117 |  |  | 12,212 |  |  | 45,421 |  |  | 2,037 |  |  | 1,825 |  |  | 49,283 |
Acquisition and integration related costs(a) | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 5,285 |  |  | 5,285 |
Gain on sale of property(b) | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (11,079 | ) |  | (11,079 | )
Interest and financing expenses | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 12,586 |  |  | 12,586 |
Income tax expense | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 37,514 |  |  | 37,514 |
Non-operating pension and OPEB items | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (583 | ) |  | (583 | )
Other(c) | 355 |  |  | — |  |  | — |  |  | 355 |  |  | — |  |  | (1,063 | ) |  | (708 | )
Adjusted EBITDA | $ | 115,616 |  |  | $ | 78,597 |  |  | $ | 60,071 |  |  | $ | 254,284 |  |  | $ | 7,243 |  |  | $ | (35,660 | ) |  | $ | 225,867 |
Three months ended March 31, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) attributable to Albemarle Corporation | $ | 108,334 |  |  | $ | 59,536 |  |  | $ | 55,660 |  |  | $ | 223,530 |  |  | $ | 1,760 |  |  | $ | (93,530 | ) |  | $ | 131,760 |
Depreciation and amortization | 24,065 |  |  | 10,433 |  |  | 12,170 |  |  | 46,668 |  |  | 2,102 |  |  | 1,560 |  |  | 50,330 |
Acquisition and integration related costs(a) | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,201 |  |  | 2,201 |
Interest and financing expenses | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 13,538 |  |  | 13,538 |
Income tax expense | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 20,361 |  |  | 20,361 |
Non-operating pension and OPEB items | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (2,197 | ) |  | (2,197 | )
Legal accrual(d) | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 17,628 |  |  | 17,628 |
Environmental accrual(e) | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 15,597 |  |  | 15,597 |
Other(f) | (1,385 | ) |  | — |  |  | — |  |  | (1,385 | ) |  | — |  |  | 885 |  |  | (500 | )
Adjusted EBITDA | $ | 131,014 |  |  | $ | 69,969 |  |  | $ | 67,830 |  |  | $ | 268,813 |  |  | $ | 3,862 |  |  | $ | (23,957 | ) |  | $ | 248,718 |
(a) | Included acquisition and integration related costs relating to various significant projects. For the three-month period ended March 31, 2019, $5.3 million was recorded in Selling, general and administrative expenses. For the three-month period ended March 31, 2018, $1.0 million and $1.2 million was recorded in Cost of goods sold and Selling, general and administrative expenses, respectively.
(b) | Gain recorded in Other income (expenses), net related to the sale of land in Pasadena, Texas not used as part of our operations.
(c) | Included amounts for the three months ended March 31, 2019 recorded in:
▪ | Cost of goods sold - $0.4 million related to non-routine labor and compensation related costs in Chile that are outside normal compensation arrangements.
▪ | Selling, general and administrative expenses - Expected severance payments as part of a business reorganization plan of $0.5 million, with the unpaid balance recorded in Accrued expenses as of March 31, 2019.
▪ | Other income (expenses), net - $1.6 million of a net gain resulting from the revision of indemnifications and other liabilities related to previously disposed businesses.
(d) | Included in Other income (expenses), net is a charge of $17.6 million resulting from a jury rendered verdict against Albemarle related to certain business concluded under a 2014 sales agreement for products that Albemarle no longer manufactures.
(e) | Increase in environmental reserve to indemnify the buyer of a formerly owned site recorded in Other income (expenses), net. As defined in the agreement of sale, this indemnification has a set cutoff date in 2024, at which point we will no longer be required to provide financial coverage.
(f) | Included amounts for the three months ended March 31, 2018 recorded in:
▪ | Cost of goods sold - $1.1 million for the write-off of fixed assets related to a major capacity expansion in our Jordanian joint venture.
▪ | Selling, general and administrative expenses - $1.4 million gain related to a refund from Chilean authorities due to an overpayment made in a prior year.
▪ Other income (expenses), net - $0.2 million of a net gain resulting from the revision of indemnifications and other liabilities related to previously disposed businesses.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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