lthm-20210331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 10-Q

_______________________________________________________________________


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

For the quarterly period ended March 31, 2021


☐			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.)

2929 Walnut Street	Philadelphia	Pennsylvania	19104
(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, 2021, there were 146,565,688 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 1 and 20 20 (unaudited)			4
Condensed Consolidated Statements of Comprehensive (Loss)/Income - Three M onths Ended March 31, 2021 and 20 20 (unaudited)			5
Condensed Consolidated Balance Sheets - March 31, 2021 (unaudited) and December 31 , 202 0			6
Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 2021 and 20 20 (unaudited)			7
Condensed Consolidated Statements of Equity - Three Months Ended March 31, 2021 and 20 20 (unaudited)			8
Notes to Condensed Consolidated Financial Statements (unaudited)			9
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			28
Item 3. Quantitative and Qualitative Disclosures About Market Risk			38
Item 4. Controls and Procedures			38
Part II - OTHER INFORMATION			39
Item 1. Legal Proceedings			39
Item 1A. Risk Factors			39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			39

Item 6. Exhibits			40
Signatures			41

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, including $20.75 million issued upon exercise of the Over-Allotment Option on July 7, 2020.
Application			The application filed by Livent with the CCAA Court to obtain remittance of the Escrow Funds
ASC			Accounting Standards Codification, under U.S. GAAP
ASC 842			Accounting Standards Codification Topic 842 - Leases
ASU			Accounting Standards Update, under U.S. GAAP
ASU 2020-06			ASU No. 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity
CCAA			The Companies’ Creditors Arrangement Act (Canada)
CCAA Court			The Superior Court of Québec where Nemaska, Nemaska Lithium Inc. and certain affiliates filed for creditor protection in Canada under the CCAA
Credit Agreement			The Original Credit Agreement, as amended on May 6, 2020, by the First Amendment and August 3, 2020, by the Second Amendment
EAETR			Estimated annual effective tax rate
Escrow Funds			The funds held in escrow by a third party for the benefit of Livent in connection with the Nemaska matter
ESG			Environmental, social and governance
EV			Electric vehicle
FASB			Financial Accounting Standards Board
First Amendment			On May 6, 2020, Livent Corporation entered into the First Amendment to the Credit Agreement to amend and restate the Original Credit Agreement
FMC			FMC Corporation
FMC Plan			FMC Corporation Incentive Compensation and Stock Plan
IPO			Initial public offering
Livent NQSP			Livent Non-Qualified Savings Plan
Livent Plan			Livent Corporation Incentive Compensation and Stock Plan
Nemaska			Nemaska Lithium Shawinigan Transformation Inc., a subsidiary of Nemaska Lithium Inc. based in Québec, Canada
Nemaska Transaction			The transaction through which a consortium has purchased and will operate the business previously conducted by Nemaska Lithium Inc., a Canadian lithium producer


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
Over-Allotment Option			Option to purchase an additional $20.75 million principal amount of 2025 Notes exercised on July 7, 2020.
Revolving Credit Facility			Livent's $400 million senior secured revolving credit facility
RSU			Restricted stock unit
SEC			Securities and Exchange Commission
Second Amendment			On August 3, 2020, Livent Corporation entered into the Second Amendment to the Credit Agreement to amend the Credit Agreement
Securities Act			Securities Act of 1933
Separation			On October 15, 2018, Livent completed its IPO and sold 20 million shares of Livent common stock to the public at a price of $17.00 per share
Tax Act			Tax Cuts and Jobs Act
U.S. GAAP			United States Generally Accepted Accounting Principles

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


	Three Months Ended March 31,
	2021		2020
(in Millions, Except Per Share Data)	(unaudited)
Revenue	$	91.7	$	68.5
Cost of sales	78.4		53.9
Gross margin	13.3		14.6
Selling, general and administrative expenses	10.7		10.8

Research and development expenses	0.7		1.0
Restructuring and other charges	0.3		4.8
Separation-related costs	(0.1)		0.1
Total costs and expenses	90.0		70.6
Income/(loss) from operations before equity in net loss of unconsolidated affiliates, interest expense, net and income taxes	1.7		(2.1)

Equity in net loss of unconsolidated affiliates	1.3		0.1

Interest expense, net	0.3		—
Income/(loss) from operations before income taxes	0.1		(2.2)
Income tax expense/(benefit)	0.9		(0.3)


Net loss	$	(0.8)	$	(1.9)
Net loss per weighted average share - basic and diluted	$	(0.01)	$	(0.01)

Weighted average common shares outstanding - basic and diluted	146.5		146.1

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

LIVENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS


	Three Months Ended March 31,
			2021		2020
(in Millions)		(unaudited)
Net loss			$	(0.8)	$	(1.9)
Other comprehensive loss, net of tax:
Foreign currency adjustments:
Foreign currency translation loss arising during the period			(0.3)		(1.8)

Total foreign currency translation adjustments (1)			(0.3)		(1.8)




Other comprehensive loss, net of tax			(0.3)		(1.8)
Comprehensive loss			$	(1.1)	$	(3.7)

____________________

1.Income taxes are not provided on the equity in undistributed earnings of our foreign subsidiaries because it is our intention that such earnings will remain invested in those subsidiaries indefinitely.

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, 2021		December 31, 2020
ASSETS	(unaudited)
Current assets
Cash and cash equivalents	$	21.5	$	11.6
Trade receivables, net of allowance of $0.4 in 2021 and $0.4 in 2020	82.7		76.3
Inventories, net	96.7		105.6

Prepaid and other current assets	40.6		56.3


Total current assets	241.5		249.8
Investments	22.8		23.8
Property, plant and equipment, net of accumulated depreciation of $228.1 in 2021 and $222.4 in 2020	560.0		545.3



Deferred income taxes	12.1		13.4
Right of use assets - operating leases, net	4.9		16.1
Other assets	87.3		88.4
Total assets	$	928.6	$	936.8
LIABILITIES AND EQUITY
Current liabilities

Accounts payable, trade and other	$	38.7	$	43.9
Accrued customer rebates	—		0.3

Accrued and other current liabilities