lthm-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 10-Q

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☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2022


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _______ to _______

Commission File Number 001-38694

__________________________________________________________________________

LIVENT CORPORATION

(Exact name of registrant as specified in its charter)

__________________________________________________________________________


Delaware			82-4699376
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

1818 Market Street	Philadelphia	Pennsylvania	19103
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: 215-299-5900

__________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	LTHM	New York Stock Exchange

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES ☒ NO ☐

INDICATE BY CHECK MARK WHETHER THE REGISTRANT HAS SUBMITTED ELECTRONICALLY EVERY INTERACTIVE DATA FILE REQUIRED TO BE SUBMITTED PURSUANT TO RULE 405 OF REGULATION S-T (§232.405 OF THIS CHAPTER) DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO SUBMIT SUCH FILES). YES ☒ NO ☐

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A LARGE ACCELERATED FILER, AN ACCELERATED FILER, A NON-ACCELERATED FILER, A SMALLER REPORTING COMPANY, OR AN EMERGING GROWTH COMPANY. SEE THE DEFINITIONS OF “LARGE ACCELERATED FILER,” “ACCELERATED FILER,” “SMALLER REPORTING COMPANY,” AND "EMERGING GROWTH COMPANY" IN RULE 12B-2 OF THE EXCHANGE ACT.

LARGE ACCELERATED FILER

☒

ACCELERATED FILER

☐

NON-ACCELERATED FILER

☐

SMALLER REPORTING COMPANY

☐

EMERGING GROWTH COMPANY

☐

IF AN EMERGING GROWTH COMPANY, INDICATE BY CHECK MARK IF THE REGISTRANT HAS ELECTED NOT TO USE THE EXTENDED TRANSITION PERIOD FOR COMPLYING WITH ANY NEW OR REVISED FINANCIAL ACCOUNTING STANDARDS PROVIDED PURSUANT TO SECTION 13(A) OF THE EXCHANGE ACT.

☐

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A SHELL COMPANY (AS DEFINED IN RULE 12B-2 OF THE EXCHANGE ACT). YES ☐ NO ☒

As of March 31, 2022, there were 161,745,365 shares of Common Stock, $0.001 par value per share, outstanding.

LIVENT CORPORATION

INDEX


			Page No.
Glossary of Terms			3
Part I - FINANCIAL INFORMATION			4
Item 1. Financial Statements			4
Condensed Consolidated Statements of Operations - Three Months Ended March 3 1 , 202 2 and 202 1 (unaudited)			4
Condensed Consolidated Statements of Comprehensive Income/(Loss) - Three Months Ended March 31, 2022 and 2021 (unaudited)			5
Condensed Consolidated Balance Sheets - March 31, 2021(unaudited) and December 31, 2021			6
Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 2022 and 2021 (unaudited)			7
Condensed Consolidated Statements of Equity - Three Months Ended March 31, 2022 and 2021 (unaudited)			9
Notes to Condensed Consolidated Financial Statements (unaudited)			10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			24
Item 3. Quantitative and Qualitative Disclosures About Market Risk			35
Item 4. Controls and Procedures			35
Part II - OTHER INFORMATION			36
Item 1. Legal Proceedings			36
Item 1A. Risk Factors			36
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			36

Item 6. Exhibits			37
Signatures			38

Glossary of Terms

When the following terms and abbreviations appear in the text of this report, they have the meanings indicated below:


2025 Notes			$245.75 million principal amount 4.125% Convertible Senior Notes due 2025

ASU			Accounting Standards Update, under U.S. GAAP
Credit Agreement			The Original Credit Agreement, as amended
EAETR			Estimated annual effective tax rate
ESG			Environmental, social and governance
EV			Electric vehicle
FASB			Financial Accounting Standards Board
FMC			FMC Corporation


Livent NQSP			Livent Non-Qualified Savings Plan

Nemaska			Nemaska Lithium Shawinigan Transformation Inc., a subsidiary of Nemaska Lithium Inc., a Canadian lithium company based in Québec, Canada
Nemaska Project			The ownership and operation of the business previously conducted by Nemaska, by a consortium in which Livent indirectly owns a 25% equity interest through its investment in QLP.
Nemaska Transaction			The transaction through which a consortium has purchased and operates the business previously conducted by Nemaska Lithium Inc.


Offering			On June 15, 2021, the Company closed on the issuance of 14,950,000 shares of its common stock, par value $0.001 per share, at a public offering price of $17.50 per share, in an underwritten public offering. Total net proceeds from the offering were $252.2 million.
OEM			Original equipment manufacturer
Original Credit Agreement			On September 18, 2018 Livent Corporation entered into the credit agreement, which provides for a $400 million senior secured revolving credit facility
PRSU			Performance-based restricted stock unit
QLP			Québec Lithium Partners, a joint venture owned equally by The Pallinghurst Group and Livent. QLP owns a 50% equity interest in the Nemaska Project.
Revolving Credit Facility			Livent's $400 million senior secured revolving credit facility
RSU			Restricted stock unit
SEC			Securities and Exchange Commission
Securities Act			Securities Act of 1933
Separation			On October 15, 2018, Livent completed its initial public offering and sold 20 million shares of Livent common stock to the public at a price of $17.00 per share

TSR			Total Shareholder Return
U.S. GAAP			United States Generally Accepted Accounting Principles
VAT			Value-added tax

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


	Three Months Ended March 31,
	2022		2021
(in Millions, Except Per Share Data)	(unaudited)
Revenue	$	143.5	$	91.7
Cost of sales	83.6		78.4
Gross margin	59.9		13.3
Selling, general and administrative expenses	11.8		10.7
Research and development expenses	0.9		0.7
Restructuring and other charges	1.0		0.3
Separation-related costs/(income)	0.1		(0.1)
Total costs and expenses	97.4		90.0
Income from operations before equity in net loss of unconsolidated affiliate, interest expense, net and other gain	46.1		1.7
Equity in net loss of unconsolidated affiliate	2.2		1.3

Interest expense, net	—		0.3
Other gain	(14.0)		—
Income from operations before income taxes	57.9		0.1
Income tax expense	4.7		0.9


Net income/(loss)	$	53.2	$	(0.8)
Net income/(loss) per weighted average share - basic	$	0.33	$	(0.01)
Net income/(loss) per weighted average share - diluted	$	0.28	$	(0.01)
Weighted average common shares outstanding - basic	161.7		146.5
Weighted average common shares outstanding - diluted	191.4		146.5

The accompanying notes are an integral part of these condensed consolidated financial statements.

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)


	Three Months Ended March 31,
	2022		2021
(in Millions)	(unaudited)
Net income/(loss)	$	53.2	$	(0.8)
Other comprehensive loss, net of tax:
Foreign currency adjustments:
Foreign currency translation loss arising during the period	(1.0)		(0.3)

Total foreign currency translation adjustments	(1.0)		(0.3)
Derivative instruments:
Unrealized hedging gains, net of tax of $0.1	0.1		—

Total derivative instruments, net of tax of $0.1	0.1		—
Other comprehensive loss, net of tax	(0.9)		(0.3)
Comprehensive income/(loss)	$	52.3	$	(1.1)

The accompanying notes are an integral part of these condensed consolidated financial statements.

LIVENT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS


(in Millions, Except Share and Par Value Data)	March 31, 2022		December 31, 2021
ASSETS	(unaudited)
Current assets
Cash and cash equivalents	$	68.5	$	113.0
Trade receivables, net of allowance of approximately $0.3 in 2022 and $0.3 in 2021	105.5		96.4
Inventories, net	150.5		134.6
Prepaid and other current assets	40.0		55.3


Total current assets	364.5		399.3
Investments	33.4		27.2
Property, plant and equipment, net of accumulated depreciation of $246.2 in 2022 and $243.0 in 2021	737.8		677.9



Deferred income taxes	—		0.9
Right of use assets - operating leases, net	6.0		6.3
Other assets	100.9		90.9
Total assets	$	1,242.6	$	1,202.5
LIABILITIES AND EQUITY
Current liabilities

Accounts payable, trade and other	$	62.2	$	65.4


Accrued and other liabilities	54.2		61.8
Operating lease liabilities - current	1.1		1.1



Income taxes	2.8		3.0

Total current liabilities	120.3		131.3
Long-term debt	240.8		240.4
Operating lease liabilities - long-term	5.0		5.4
Environmental liabilities	5.7		5.6
Deferred income taxes	7.7		12.7
Other long-term liabilities	14.1		11.7
Commitments and contingent liabilities (Note 13)	—		—
Total current and long-term liabilities	393.6		407.1
Equity
Common stock; $0.001 par value; 2 billion shares authorized; 161,848,607 and 161,791,602 shares issued; 161,745,365 and 161,689,984 outstanding as of March 31, 2022 and December 31, 2021, respectively	0.1		0.1
Capital in excess of par value of common stock	779.4		778.1
Retained earnings	114.1		60.9
Accumulated other comprehensive loss	(43.8)		(42.9)
Treasury stock, at cost; 103,242 and 101,618 shares as of March 31, 2022 and December 31, 2021, respectively	(0.8)		(0.8)


Total equity	849.0		795.4
Total liabilities and equity	$	1,242.6	$	1,202.5

The accompanying notes are an integral part of these condensed consolidated financial statements.

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three Months Ended March 31,
	2022		2021
(in Millions)	(unaudited)
Cash provided by operating activities:
Net income/(loss)	$	53.2	$	(0.8)
Adjustments to reconcile net income/(loss) to cash provided by operating activities:
Depreciation and amortization	6.4		6.2
Restructuring and other charges	0.8		0.1
Deferred income taxes	0.8		1.3
Separation-related (income)/costs	(0.3)		0.6
Share-based compensation	1.6		1.1
Change in investments in trust fund securities	0.2		(0.2)
Loss on disposal of assets	0.1		—
Deferred financing fees amortization	—		0.3
Equity in net loss of unconsolidated affiliate	2.2		1.3
Other gain, Blue Chip Swap	(14.0)		—
Changes in operating assets and liabilities:
Trade receivables, net	(9.3)		(6.3)
Inventories	(16.5)		9.1
Accounts payable, trade and other	(3.2)		(5.2)

Changes in deferred compensation	0.7		0.6
Income taxes	(0.1)		0.4
Change in prepaid and other current assets and other assets	5.1		16.5
Change in accrued and other current and long-term liabilities	(16.9)		(12.3)
Cash provided by operating activities	10.8		12.7
Cash used in investing activities:
Capital expenditures(1)	(68.7)		(25.5)
Investments in Livent NQSP securities	(0.7)		(0.6)
Proceeds from Blue Chip Swap, net of purchases	14.0		—
Other investing activities	—

SEC Form 10-Q filed by Livent Corporation