Livent Releases Fourth Quarter and Full Year 2022 Results

($ million)

FY 2023 Guidance

FY 2022 Results

YoY Growth

Revenue

1,000 – 1,100

813

Up 23% – 35%

Adjusted EBITDA

510 – 580

367

Up 39% – 58%

Full Year 2023

•  Adjusted tax rate

•  Full-year weighted average diluted shares outstanding ⁽³⁾

•  Depreciation & amortization

•  Adjusted cash from operations

•  Capital expenditures and other investing activities

16 – 19

~210

$46 - $52

$360 - $440

$325 - $375

percent

million

million

million

million

LIVENT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in millions, except per share data)

Three Months Ended

Twelve Months Ended

 December 31,

 December 31,

2022

2021

2022

2021

Revenue

$       219.4

$       122.9

$       813.2

$       420.4

Costs of sales

105.5

86.5

417.5

332.0

Gross margin

113.9

36.4

395.7

88.4

Selling, general and administrative expenses

14.6

15.7

55.2

49.9

Research and development expenses

1.3

0.8

3.9

3.0

Restructuring and other charges

2.9

0.4

7.5

3.8

Separation-related costs

0.2

0.7

0.7

2.0

Total costs and expenses

124.5

104.1

484.8

390.7

Income from operations before equity in net loss of unconsolidated
affiliate, interest expense, net, loss on debt extinguishment and other gain

94.9

18.8

328.4

29.7

Equity in net loss of unconsolidated affiliate

6.7

1.8

15.1

5.5

Interest expense, net

—

—

—

0.3

Loss on debt extinguishment

—

—

0.1

—

Other gain

—

—

(22.2)

—

Income from operations before income taxes

88.2

17.0

335.4

23.9

Income tax expense

5.5

9.5

61.9

23.3

Net income

$         82.7

$           7.5

$       273.5

$           0.6

Net income per weighted average share - basic

$         0.46

$         0.05

$         1.59

$             —

Net income per weighted average share - diluted

$         0.39

$         0.04

$         1.36

$             —

Weighted average common shares outstanding - basic

179.5

161.7

171.8

154.7

Weighted average common shares outstanding - diluted

209.4

191.6

201.6

184.3

LIVENT CORPORATION

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

RECONCILIATION OF NET INCOME TO EBITDA (NON-GAAP) AND ADJUSTED EBITDA (NON-GAAP)

(Unaudited)

Three Months Ended

Twelve Months Ended

 December 31,

 December 31,

(In Millions)

2022

2021

2022

2021

Net income

$           82.7

$             7.5

$         273.5

$             0.6

Add back:

Interest expense, net

—

—

—

0.3

Income tax expense

5.5

9.5

61.9

23.3

Depreciation and amortization

8.3

6.4

27.7

25.1

EBITDA (Non-GAAP) ⁽¹⁾

96.5

23.4

363.1

49.3

Add back:

Argentina remeasurement losses ^(a)

3.7

1.1

6.7

5.3

Restructuring and other charges ^(b)

2.9

0.4

7.5

3.8

Separation-related costs ^(c)

0.2

0.7

0.7

2.0

COVID-19 related costs ^(d)

0.3

1.0

2.4

5.2

Loss on debt extinguishment ^(e)

—

—

0.1

—

Other loss ^(f)

4.0

0.9

9.9

3.9

Subtract:

Blue Chip Swap gain ^(g)

—

—

(22.2)

—

Argentina interest income ^(h)

—

—

(1.5)

—

Adjusted EBITDA (Non-GAAP) ⁽¹⁾

$         107.6

$           27.5

$         366.7

$           69.5

_________________

1.

We evaluate operating performance using certain Non-GAAP measures such as EBITDA, which we define as net income plus interest
expense, net, income tax (benefit)/expense, depreciation, and amortization, and Adjusted EBITDA, which we define as EBITDA adjusted
for Argentina remeasurement losses, restructuring and other charges, separation-related costs, COVID-19 related costs and other
losses/(gains). Management believes the use of these Non-GAAP measures allows management and investors to compare more easily
the financial performance of its underlying business from period to period. The Non-GAAP information provided may not be comparable
to similar measures disclosed by other companies because of differing methods used by other companies in calculating EBITDA and
Adjusted EBITDA. These measures should not be considered as a substitute for net income or other measures of performance or liquidity
reported in accordance with U.S. GAAP. The above table reconciles EBITDA and Adjusted EBITDA from net income.

a.

Represents impact of currency fluctuations on tax assets and liabilities and on long-term monetary assets associated with our capital
expansion, as well as significant currency devaluations. The remeasurement losses are included within "Cost of sales" in our consolidated
statement of operations but are excluded from our calculation of Adjusted EBITDA because of: i.) their nature as income tax related; ii.)
their association with long-term capital projects which will not be operational until future periods; or iii.) the severity of the devaluations
and their immediate impact on our operations in the country.

b.

We continually perform strategic reviews and assess the return on our business. This sometimes results in management changes or in a
plan to restructure the operations of our business. As part of these restructuring plans, demolition costs and write-downs of long-lived
assets may occur. 2022 Restructuring and other charges consisted primarily of transaction related legal fees and miscellaneous
nonrecurring costs, exit costs, severance-related costs and environmental remediation. 2021 Restructuring and other charges consisted
primarily of environmental remediation, transaction related legal fees and miscellaneous nonrecurring costs.

c.

Represents legal and professional fees and other separation-related activity.

d.

Represents incremental costs associated with COVID-19 recorded in "Cost of sales" in the consolidated statements of operations,
including but not limited to, incremental quarantine related absenteeism, incremental facility cleaning costs, COVID-19 testing, pandemic
related supplies and personal protective equipment for employees, among other costs; offset by economic relief provided by foreign
governments.

e.

Represents the partial write off of deferred financing costs for the amendments to our Revolving Credit Facility excluded from our
calculation of Adjusted EBITDA because the loss is nonrecurring.

f.

Represents our 50% ownership interest (which was 25% prior to June 6, 2022) in costs incurred for certain project-related costs to align
Nemaska's reported results with Livent's capitalization policies, interest expense incurred by NLI and non-recurring transaction costs related
to our initial investment in NLI, all included in Equity in net loss of unconsolidated affiliate in our consolidated statement of operations.
The company accounts for its equity method investment in the NLI on a one-quarter lag basis.

g.

Represents the gain from the sale in Argentina pesos of Argentina Sovereign U.S. dollar-denominated bonds and is excluded from
Adjusted EBITDA because it is nonrecurring.

h.

Represents interest income received from the Argentina government for the period beginning when the recoverability of certain of our
expansion-related VAT receivables were approved by the Argentina government and ending on the date when the reimbursements were
paid by the Argentina government but is excluded from our calculation of Adjusted EBITDA because of its association with long-term
capital projects which will not be operational until future periods.

RECONCILIATION OF NET INCOME TO ADJUSTED AFTER-TAX EARNINGS (NON-GAAP)

(Unaudited)

Three Months Ended

Twelve Months Ended

 December 31,

 December 31,

(In Millions, except per share amounts)

2022

2021

2022

2021

Net income

$         82.7

$           7.5

$       273.5

$           0.6

Special charges:

Argentina remeasurement losses^(a)

3.7

1.1

6.7

5.3

Restructuring and other charges ^(b)

2.9

0.4

7.5

3.8

Separation-related costs^(c)

0.2

0.7

0.7

2.0

COVID-19 related costs ^(d)

0.3

1.0

2.4

5.2

Loss on debt extinguishment ^(e)

—

—

0.1

—

Other loss ^(f)

4.0

0.9

9.9

3.9

Blue Chip Swap gain ^(g)

—

—

(22.2)

—

Argentina interest income ^(h)

—

—

(1.5)

—

Non-GAAP tax adjustments ^(j)

(9.6)

4.0

5.5

12.7

Adjustment for interest, net of tax, on 2025 Notes assumed converted ⁽ⁱ⁾

—

—

—

0.2

Adjusted after-tax earnings (Non-GAAP) ⁽¹⁾

$         84.2

$         15.6

$       282.6

$         33.7

Diluted earnings per common share

$         0.39

$         0.04

$         1.36

$             —

Special charges per diluted share, before tax:

Argentina remeasurement losses, per diluted share

0.02

0.01

0.03

0.03

Restructuring and other charges, per diluted share

0.02

—

0.04

0.02

Separation-related costs, per diluted share

—

—

—

0.01

COVID-19 related costs, per diluted share

—

0.01

0.01

0.03

Other loss, per diluted share

0.02

—

0.05

0.02

Blue Chip Swap gain, per diluted share

—

—

(0.11)

—

Argentina interest income, per diluted share

—

—

(0.01)

—

Non-GAAP tax adjustments per diluted share

(0.05)

0.02

0.03

0.07

Diluted adjusted after-tax earnings per share (Non-GAAP) ⁽¹⁾

$         0.40

$         0.08

$         1.40

$         0.18

Weighted average number of shares outstanding used in diluted adjusted
after-tax earnings per share computations (Non-GAAP)

209.4

191.6

201.6

184.3

____________________

1.

The company believes that the Non-GAAP financial measures "Adjusted after-tax earnings" and "Diluted adjusted after-tax earnings per
share" provide useful information about the company's operating results to management, investors and securities analysts. Adjusted
after-tax earnings excludes the effects of nonrecurring charges/(income) and tax-related adjustments. The company also believes that
excluding the effects of these items from operating results allows management and investors to compare more easily the financial
performance of its underlying business from period to period. Diluted adjusted after-tax earnings per share (Non-GAAP) is calculated
using weighted average common shares outstanding - diluted.           

a.

Represents charges related to currency fluctuations on tax assets and liabilities and on long-term monetary assets associated with our
capital expansion, as well as significant currency devaluations. The remeasurement losses are included within "Cost of sales" in our
consolidated statement of operations but are excluded from our calculation of Adjusted EBITDA because of: i.) their nature as income
tax related; ii.) their association with long-term capital projects which will not be operational until future periods; or iii.) the severity of
the devaluations and their immediate impact on our operations in the country.

b.

We continually perform strategic reviews and assess the return on our business. This sometimes results in management changes or
in a plan to restructure the operations of our business. As part of these restructuring plans, demolition costs and write-downs of
long-lived assets may occur. 2022 Restructuring and other charges consisted primarily of transaction related legal fees and
miscellaneous nonrecurring costs, exit costs, severance-related costs and environmental remediation. 2021 Restructuring and other
charges consisted primarily of environmental remediation, transaction related legal fees and miscellaneous nonrecurring costs.

c.

Represents legal and professional fees and other separation-related activity.

d.

Represents incremental costs associated with COVID-19 recorded in "Cost of sales" in the consolidated statement of operations,
including but not limited to, incremental quarantine related absenteeism, incremental facility cleaning costs, COVID-19 testing,
pandemic related supplies and personal protective equipment for employees, among other costs; offset by economic relief provided
by foreign governments.

e.

Represents the partial write off of deferred financing costs for the amendments to our Revolving Credit Facility excluded from our
calculation of Adjusted EBITDA because the loss is nonrecurring.

f.

Represents our 50% ownership interest (which was 25% prior to June 6, 2022) in costs incurred for certain project-related costs to
align Nemaska's reported results with Livent's capitalization policies, interest expense incurred by NLI and non-recurring transaction
costs related to our initial investment in NLI, all included in Equity in net loss of unconsolidated affiliate in our consolidated statement
of operations. The company accounts for its equity method investment in the NLI on a one-quarter lag basis.

g.

Represents the gain from the sale in Argentina pesos of Argentina Sovereign U.S. dollar-denominated bonds and is excluded from
Adjusted EBITDA because it is nonrecurring.

h.

Represents interest income received from the Argentina government for the period beginning when the recoverability of certain of
our expansion-related VAT receivables were approved by the Argentina government and ending on the date when the reimbursements
were paid by the Argentina government but is excluded from our calculation of Adjusted EBITDA because of its association with
long-term capital projects which will not be operational until future periods.

i.

For the three and twelve months ended December 31, 2022 and the three months ended December 31, 2021, all of the interest on the
2025 Notes was capitalized. For the twelve months ended December 31, 2021, $11.4 million of the interest on the 2025 Notes was
capitalized. 

j.

The company excludes the GAAP tax provision, including discrete items, from the Non-GAAP measure "Diluted adjusted after-tax
earnings per share", and instead includes a Non-GAAP tax provision based upon the annual Non-GAAP effective tax rate. The GAAP
tax provision includes certain discrete tax items including, but not limited to: income tax expenses or benefits that are not related to
operating results in the current year; tax adjustments associated with fluctuations in foreign currency remeasurement of certain foreign
operations; certain changes in estimates of tax matters related to prior fiscal years; certain changes in the realizability of deferred tax
assets and related accounting impacts; and changes in tax law. Management believes excluding these discrete tax items assists investors
and securities analysts in understanding the tax provision and the effective tax rate related to operating results thereby providing investors
with useful supplemental information about the company's operational performance. The income tax expense/(benefit) on special
charges/(income) is determined using the applicable rates in the taxing jurisdictions in which the special charge or income occurred and
includes both current and deferred income tax expense/(benefit) based on the nature of the Non-GAAP performance measure.

Three Months Ended

Twelve Months Ended

December 31,

December 31,

(in Millions)

2022

2021

2022

2021

Non-GAAP tax adjustments:

Income tax benefit on restructuring, separation-related and other corporate costs

$         (0.7)

$         (0.7)

$         (2.0)

$         (2.7)

Revisions to our tax liabilities due to finalization of prior year tax returns

—

0.5

—

0.9

Foreign currency remeasurement and other discrete items

(7.1)

5.1

7.6

16.8

Blue Chip Swap gain

—

—

2.3

—

Other discrete items

(1.8)

(0.9)

(2.4)

(2.3)

Total Non-GAAP tax adjustments

$         (9.6)

$           4.0

$           5.5

$         12.7

RECONCILIATION OF CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED CASH FROM
OPERATIONS (NON-GAAP)

(Unaudited)

Twelve Months Ended

 December 31,

(In Millions)

2022

2021

Cash provided by operating activities

$           454.7

$              26.4

Restructuring and other charges

3.5

5.3

Separation-related costs

0.9

2.0

COVID-19 related costs ^(a)

2.4

5.2

Argentina interest income ^(b)

(1.5)

—

Adjusted cash from operations (Non-GAAP) ⁽¹⁾

$           460.0

$              38.9

_________________

1.

The company believes that the Non-GAAP financial measure "Adjusted cash from operations" provides useful information about the
company's cash flows to investors and securities analysts. Adjusted cash from operations excludes the effects of transaction-related
cash flows. The company also believes that excluding the effects of these items from cash provided by operating activities allows
management and investors to compare more easily the cash flows from period to period.

a.

Represents incremental costs associated with COVID-19 recorded in "Cost of sales" in the consolidated statement of operations,
including but not limited to, incremental quarantine related absenteeism, incremental facility cleaning costs, COVID-19 testing, pandemic
related supplies and personal protective equipment for employees, among other costs; offset by economic relief provided by foreign
governments.

b.

Represents interest income received from the Argentina government for the period beginning when the recoverability of certain of our
expansion-related VAT receivables were approved by the Argentina government and ending on the date when the reimbursements
were paid by the Argentina government but is excluded from our calculation of Adjusted EBITDA because of its association with
long-term capital projects which will not be operational until future periods.

RECONCILIATION OF LONG-TERM DEBT (GAAP) AND CASH AND CASH EQUIVALENTS (GAAP) TO
NET DEBT (NON-GAAP)

(Unaudited)

(In Millions)

December 31, 2022

December 31, 2021

Long-term debt (GAAP) ^(a)

$                    241.9

$                    240.4

Less: Cash and cash equivalents (GAAP)

(189.0)

(113.0)

Net debt (Non-GAAP) ⁽¹⁾

$                       52.9

$                    127.4

1.

The company believes that the non-GAAP financial measure "Net debt" provides useful information about the company's cash flows
and liquidity to investors and securities analysts.

a.

Presented net of unamortized transaction costs of $3.9 million and $5.4 million as of December 31, 2022 and 2021, respectively. As
of December 31, 2022 and 2021, the Company had no debt maturing within one year.     

LIVENT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In Millions)

December 31, 2022

December 31, 2021

Cash and cash equivalents

$                    189.0

$                    113.0

Trade receivables, net of allowance of approximately $0.3 in 2022 and 2021

141.6

96.4

Inventories

152.3

134.6

Other current assets

61.1

55.3

Total current assets

544.0

399.3

Investments

440.3

27.2

Property, plant and equipment, net of accumulated depreciation of $253.1 in 2022 and $243.0 in 2021

968.3

677.9

Right of use assets - operating leases, net

4.8

6.3

Deferred income taxes

0.4

0.9

Other assets

116.4

90.9

Total assets

$                 2,074.2

$                 1,202.5

Accounts payable, trade and other

$                       81.7

$                       65.4

Contract liabilities - short term

15.5

—

Other current liabilities

51.5

65.9

Total current liabilities

148.7

131.3

Long-term debt

241.9

240.4

Contract liabilities - long term

198.0

—

Other long-term liabilities

42.6

35.4

Equity

1,443.0

795.4

Total liabilities and equity

$                 2,074.2

$                 1,202.5

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Twelve Months Ended December 31,

(In Millions)

2022

2021

Cash provided by operating activities

$                    454.7

$                       26.4

Cash used in investing activities

(364.7)

(143.3)

Cash (used in)/provided by financing activities

Effect of exchange rate changes on cash

(1.5)

0.3

Increase in cash and cash equivalents

76.0

101.4

Cash and cash equivalents, beginning of period

113.0

11.6

Cash and cash equivalents, end of period

$                    189.0

$                    113.0