FMC Earnings: We See Clear Path to Profit Growth and End of Inventory Destocking in 2024

FMC's first-quarter results reflected the end of the inventory destocking that caused revenue and profits to decline throughout 2023. Adjusted EBITDA was down 56% versus the prior-year quarter as volumes declined 27%. We had expected inventory destocking would continue to weigh on FMC's results to begin the year. Our key takeaway from the earnings report is that the company is beginning to see the end of inventory destocking, which should lead to markedly improved results throughout 2024. This is in line with our thesis that inventory destocking would be largely complete by the first half of the year. As FMC begins to see more normalized demand, it should be able to ramp up its plants closer to normal capacity utilization, greatly reducing unit production costs.