Quarterly adjusted EBITDA of $547.8 million
Olin Corporation announced financial results for the third quarter ended September 30, 2022. Third quarter 2022 reported net income was $315.2 million, or $2.18 per diluted share, which compares to third quarter 2021 reported net income of $390.7 million, or $2.38 per diluted share.
Third quarter 2022 adjusted EBITDA of $547.8 million excludes depreciation and amortization expense of $149.8 million, gains on sale of former manufacturing facilities of $13.0 million, and restructuring charges of $7.6 million. Third quarter 2021 adjusted EBITDA was $707.0 million. Sales in the third quarter 2022 were $2,321.7 million compared to $2,340.1 million in the third quarter 2021.
Scott Sutton, Chairman, President, and Chief Executive Officer, said, “We are experiencing recessionary global economic conditions. Our third quarter adjusted EBITDA performance begins to demonstrate how our winning model, that emphasizes ‘value first’ versus a volume maximization approach, should dramatically improve our recessionary level of adjusted EBITDA compared to Olin’s historical performance. While our chemical businesses have been challenged by European and North American epoxy and vinyls intermediate demand shortfalls and increased Asian exports, the core electrochemical unit (ECU) pricing for merchant chlorine and caustic soda continued to move higher.
“We expect Chlor Alkali Products and Vinyls fourth quarter segment results to be slightly lower than third quarter 2022 levels, as we expect chlorine and caustic soda pricing to continue to improve, while vinyls intermediates pricing is likely to remain under pressure. Our Epoxy segment fourth quarter results are expected to seasonally decline from third quarter 2022 levels, exacerbated by increased Chinese exports precipitated by continuing weak Chinese domestic demand. Our team continues to adeptly reduce operating rates and increase product purchases; thereby, refraining from selling incremental volume into poor-quality markets. We expect Winchester segment fourth quarter results to seasonally decline from third quarter 2022 levels as we execute our holiday shutdowns. Overall, we expect Olin’s fourth quarter 2022 adjusted EBITDA to decline approximately 15% to 20% from third quarter 2022 levels.
“So far in 2022, we repurchased approximately 13% of our outstanding shares from available cash flow, while reducing our net debt level. With our strong balance sheet and confidence in Olin’s earnings and cash flow generation even in recessionary economic conditions, we expect to continue our capital allocation strategy, while committing to maintain an investment-grade balance sheet and move Olin to an investment-grade credit rating.”