Financial Performance - Consolidated net sales for 2022 amounted to $2.8 billion, an increase of $409 million, or 17.3% from 2021[146] - Net sales for 2022 reached $2,764.8 million, a 17.3% increase from $2,356.1 million in 2021[251] - Petroleum additives net sales for 2022 were $2.754 billion, approximately 17.5% higher than 2021 levels, with North America contributing about 54% of the increase[149] - Gross profit for 2022 was $640.5 million, up from $547.7 million in 2021, reflecting a gross margin improvement[251] - Operating profit increased to $355.1 million in 2022, compared to $257.8 million in 2021, marking a 37.8% growth[251] - Net income for 2022 was $279.5 million, a 46.5% increase from $190.9 million in 2021[251] - Earnings per share (EPS) for 2022 were $27.77, up from $17.71 in 2021, representing a 56.8% increase[251] Operating Segments - Operating profit for the petroleum additives segment increased by $97 million to $378 million in 2022, with an operating profit margin of 13.7%[156][157] - The petroleum additives operating profit was 34.6% higher in 2022 compared to 2021, reflecting higher selling prices[137] - Segment operating profit for petroleum additives was $378.2 million in 2022, compared to $281.1 million in 2021, representing a 34.5% increase[311] Cash Flow and Capital Management - Cash generated from operating activities was $109 million in 2022, down from $165 million in 2021, reflecting a decrease of 34%[166] - The company redeemed $350 million of 4.10% senior notes and repurchased $207 million of common stock in 2022, utilizing cash from operations and proceeds from marketable securities[167] - Cash and cash equivalents decreased to $69 million at December 31, 2022, compared to $83 million at the end of 2021[169] - The company repurchased 668,553 shares of common stock for a total of $207 million during 2022[139] - Cash dividends paid in 2022 were $84,263,000, slightly down from $85,910,000 in 2021[260] Debt and Equity - Long-term debt decreased from $1.1 billion at December 31, 2021, to $1.0 billion at December 31, 2022, primarily due to the redemption of senior notes[181] - Total long-term debt at December 31, 2022, was $1 billion, with $361 million in variable rate debt under the revolving credit facility[231] - The total long-term debt as a percentage of total capitalization decreased from 59.9% at the end of 2021 to 56.8% at the end of 2022[182] - The company's pension benefit obligation was $466 million as of December 31, 2022[246] Investments and Expenditures - Research and development (R&D) investment decreased by approximately $4 million, representing 5.1% of net sales in 2022 compared to 6.1% in 2021[162] - Capital expenditures were $56 million in 2022, with an estimated range of $70 million to $80 million for 2023, focusing on manufacturing and R&D improvements[186] - Corporate additions to long-lived assets were $3,983 thousand in 2022, significantly higher than $686 thousand in 2021[315] Market Outlook and Challenges - The company anticipates challenges in 2023 due to ongoing inflationary pressures and supply chain issues[141] - The petroleum additives market is expected to grow at a rate of 1% to 2% annually, with the company planning to exceed this growth rate in the long term[213] Pension and Retirement Plans - An actuarial loss of $149 million was recorded in 2022 due to actual investment returns being less than expected for U.S. qualified pension plans[197] - The expected aggregate cash contributions to the U.S. pension plans are approximately $3 million, and to the postretirement benefit plans are approximately $2 million in 2023[203] - The expected long-term rate of return for the U.K. pension plan was 6.7% at December 31, 2022, based on the actual asset allocation and expected yields[206] - The company expects aggregate U.K. cash contributions to be approximately $4 million in 2023[211] Financial Position - Total assets decreased to $2,406.8 million in 2022 from $2,558.4 million in 2021, a decline of 5.9%[256] - Total shareholders' equity remained relatively stable at $762.4 million in 2022 compared to $762.1 million in 2021[256] - The company maintained effective internal control over financial reporting as of December 31, 2022, according to the independent auditor's opinion[238]

Financial Data and Key Metrics Changes - Net income for Q4 2022 was $91 million or $9.26 per share, while net income for the full year was $280 million or $27.77 per share, compared to $191 million or $17.71 per share for 2021 [4] - Operating profit increase for the year was mainly due to increased selling prices, partially offset by higher raw material and operating costs [5] - Working capital increased by $204 million, with capital expenditures funded at $56 million and $292 million returned to shareholders through dividends and share repurchases [14] Business Line Data and Key Metrics Changes - Petroleum additives sales for Q4 were $680 million, reaching $2.8 billion for 2022 compared to $2.3 billion for 2021 [13] - Petroleum additives operating profit for Q4 was $117 million, totaling $378 million for 2022 compared to $281 million for 2021 [13] - Petroleum additives operating margin for 2022 was 13.7%, down from 16.5% in 2019 [15] Market Data and Key Metrics Changes - Shipments decreased by 2.9% year-over-year, primarily due to declines in lubricant additives shipments, influenced by supply chain disruptions and sanctions from the Russia-Ukraine war [5] Company Strategy and Development Direction - The company plans capital investments in the range of $70 million to $80 million for 2023, focusing on long-term value creation for shareholders and customers [6][18] - The company emphasizes a long-term view, safety-first culture, customer-focused solutions, technology-driven product offerings, and world-class supply chain capabilities [16] Management Comments on Operating Environment and Future Outlook - Management acknowledged ongoing challenges from inflationary pressures and rising operating costs expected to continue into 2023 [7] - Margin recovery and cost control will remain priorities throughout 2023 [18] Other Important Information - The company intends to file its 2022 10-K towards the end of February, which will provide more detailed operational performance insights [12] Q&A Session Summary - No specific questions or answers were documented in the provided content, indicating a lack of detailed interaction during the Q&A segment [19]

NewMarket Corp (NYSE:NEU) Q3 2022 Earnings Conference Call October 25, 2022 3:00 PM ET Company Participants Brian Paliotti - VP & CFO Conference Call Participants Operator Good afternoon, ladies and gentlemen, and welcome to the NewMarket Corporation Conference Call and Webcast to review Third Quarter 2022 Financial Results. It is now my pleasure to turn the floor over to your host, Mr. Brian Paliotti, Vice President and Chief Financial Officer of NewMarket Corporation. Sir, the floor is yours. Mr. Paliotti ...

Table of Contents 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 September 30, 2022 OR ☐ 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 1-32190 NEWMARKET CORPORATION (Exact name of registrant as specified in its charter) Virginia 20-0812170 (State or other ...

Financial Data and Key Metrics Changes - Net income for Q2 2022 was $66 million or $6.54 per share, compared to $52 million or $4.75 per share in Q2 2021, reflecting a significant increase [5] - Petroleum additives net sales reached a record $721 million in Q2 2022, up from $586.6 million in the same period last year [6] - Operating profit for petroleum additives was $91.2 million in Q2 2022, higher than $74.2 million in Q2 2021 [6] - Operating profit margin for petroleum additives was 12.7%, which is significantly lower than historical averages [8] Business Line Data and Key Metrics Changes - Shipments increased by 2.6% between quarterly periods, with lubricant additive shipments rising, while fuel additive shipments decreased [7] - All regions except Latin America contributed to the increase in lubricant additive shipments, while all regions except North America contributed to the decrease in fuel additive shipments [7] Market Data and Key Metrics Changes - The company faced challenges from the global supply network and transportation industry, impacting operational costs [9] Company Strategy and Development Direction - The company remains focused on long-term success, emphasizing customer satisfaction, solid operating results, and long-term value for stakeholders [12] - Margin management is a priority for 2022 due to ongoing upward pressure on operating costs [8] Management Comments on Operating Environment and Future Outlook - Management acknowledged the inflationary environment affecting costs of goods sold inputs and expressed commitment to returning margins to historical levels in the mid to high teens [9] - Capital expenditures for 2022 are expected to be in the range of $55 million to $60 million, slightly below previous estimates due to operational timing [11] Other Important Information - The company funded capital expenditures of $15 million, paid dividends of $21 million, and repurchased $55 million of stock during the quarter [10] - The net debt to EBITDA ratio at the end of the quarter was 2.3 times, slightly above the normal range of 1 to 2 times [10] Q&A Session Summary Question: None provided in the transcript - The conference call concluded without any recorded questions or answers [14]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION NEWMARKET CORPORATION (Exact name of registrant as specified in its charter) Virginia 20-0812170 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 330 South Fourth Street Richmond, Virginia 23219-4350 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code - (804) 788-5000 Securities registered pursuant to Section 12(b) of the Act: WASHINGTON, D. ...

NewMarket Corporation (NYSE:NEU) Q1 2022 Earnings Conference Call April 28, 2022 3:15 PM ET Company Participants Brian Paliotti - Vice President and Chief Financial Officer Conference Call Participants Operator Good afternoon, ladies and gentlemen and welcome to the NewMarket Corporation Conference Call and Webcast to review First Quarter 2022 Financial Results. At this time, all participants have been placed on a listen-only mode. It is now my pleasure to turn the floor over to your host, Chief Financial ...

Part I [Financial Statements (unaudited)](index=4&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited consolidated financial statements for Q1 2022, highlighting a decrease in net income and significant balance sheet changes from debt redemption and marketable securities sales [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) For Q1 2022, net sales increased to $662.6 million from $566.6 million year-over-year, but net income decreased to $59.3 million from $69.7 million due to higher cost of goods sold and a $7.5 million loss on early debt extinguishment Consolidated Statements of Income (Q1 2022 vs Q1 2021) | (in thousands, except per-share amounts) | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | | :--- | :--- | :--- | | **Net sales** | $662,552 | $566,615 | | **Gross profit** | $155,163 | $161,753 | | **Operating profit** | $83,290 | $88,501 | | **Loss on early extinguishment of debt** | $7,545 | $0 | | **Net income** | $59,318 | $69,712 | | **Earnings per share - basic and diluted ($)** | $5.75 | $6.38 | | **Cash dividends declared per share ($)** | $2.10 | $1.90 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2022, total assets decreased to $2.28 billion from $2.56 billion at year-end 2021, primarily due to the sale of marketable securities and redemption of long-term debt Condensed Consolidated Balance Sheet Highlights | (in thousands) | March 31, 2022 (in thousands) | December 31, 2021 (in thousands) | | :--- | :--- | :--- | | **Total current assets** | $1,114,334 | $1,388,173 | | Marketable securities | $0 | $375,918 | | **Total assets** | $2,281,553 | $2,558,436 | | **Total current liabilities** | $411,699 | $725,087 | | Current portion of long-term debt | $0 | $349,434 | | **Total liabilities** | $1,521,463 | $1,796,307 | | **Total shareholders' equity** | $760,090 | $762,129 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For Q1 2022, operating cash flow sharply decreased to $6.8 million, while investing activities provided $359.4 million from marketable securities sales, and financing activities used $365.8 million for debt redemption and stock repurchases Consolidated Statements of Cash Flows (Q1 2022 vs Q1 2021) | (in thousands) | Three Months Ended March 31, 2022 (in thousands) | Three Months Ended March 31, 2021 (in thousands) | | :--- | :--- | :--- | | **Cash provided from (used in) operating activities** | $6,781 | $49,371 | | **Cash provided from (used in) investing activities** | $359,447 | $(20,524) | | **Cash provided from (used in) financing activities** | $(365,849) | $369,442 | | **Increase in cash and cash equivalents** | $1,246 | $397,233 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations for financial statement line items, including net sales breakdowns, debt redemption specifics, marketable securities sales, and fair value measurements Net Sales by Geographic Area (Q1 2022 vs Q1 2021) | (in thousands) | 2022 (in thousands) | 2021 (in thousands) | | :--- | :--- | :--- | | United States | $224,688 | $170,324 | | China | $52,703 | $73,988 | | Europe, Middle East, Africa, India | $195,987 | $176,650 | | Asia Pacific, except China | $104,841 | $82,597 | | Other foreign | $84,333 | $63,056 | | **Total Net sales** | **$662,552** | **$566,615** | Net Sales by Segment (Q1 2022 vs Q1 2021) | (in thousands) | 2022 (in thousands) | 2021 (in thousands) | | :--- | :--- | :--- | | **Petroleum additives** | | | | Lubricant additives | $570,042 | $494,556 | | Fuel additives | $90,262 | $70,342 | | **Total Petroleum additives** | **$660,304** | **$564,898** | | All other | $2,248 | $1,717 | | **Total Net sales** | **$662,552** | **$566,615** | - On March 15, 2022, the company redeemed its 4.10% senior notes with a principal amount of **$350 million**, recognizing a loss of **$7.5 million** on the early extinguishment[54](index=54&type=chunk) - During the first three months of 2022, the company sold all of its debt and equity marketable securities, which had a fair value of **$375.9 million** at the end of 2021[41](index=41&type=chunk)[43](index=43&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2022 results, noting a 16.9% increase in petroleum additives net sales offset by higher costs, leading to a 7.6% decrease in segment operating profit, alongside key financial activities including stock repurchases, debt redemption, and marketable securities sales [Results of Operations](index=17&type=section&id=Results%20of%20Operations) Consolidated net sales increased 16.9% to $662.6 million in Q1 2022 due to higher selling prices, but segment operating profit declined by $7.2 million as raw material costs outpaced price increases, reducing the operating profit margin to 13.2% Change in Petroleum Additives Net Sales (Q1 2021 to Q1 2022) | (in millions) | Amount (in millions) | | :--- | :--- | | Net Sales at March 31, 2021 | $564.9 | | Lubricant additives shipments | $(0.4) | | Fuel additives shipments | $2.6 | | Selling prices | $102.3 | | Foreign currency impact, net | $(9.1) | | **Net Sales at March 31, 2022** | **$660.3** | - Petroleum additives operating profit margin decreased to **13.2%** for Q1 2022 from **16.7%** for Q1 2021, reflecting the impact of significantly higher raw material costs[90](index=90&type=chunk) - The company continues to experience a lag between when raw material cost increases occur and when selling price adjustments can be implemented to recover margins[92](index=92&type=chunk) [Cash Flows, Financial Condition, and Liquidity](index=19&type=section&id=Cash%20Flows%2C%20Financial%20Condition%2C%20and%20Liquidity) The company's financial position remains strong with a $1.2 million cash increase in Q1 2022, despite operating cash flow decreasing to $6.8 million due to working capital investment, while major cash movements included marketable securities sales, debt redemption, and stock repurchases, improving the long-term debt to total capitalization ratio to 52.5% - Cash from operating activities for Q1 2022 was **$6.8 million**, adjusted for a **$67.0 million** use of cash to fund higher working capital requirements[106](index=106&type=chunk) - Capital expenditures for 2022 are projected to be between **$65 million** and **$75 million**[109](index=109&type=chunk) - The company redeemed its 4.10% senior notes for **$350 million** and repurchased **$37.3 million** of its common stock during the quarter[110](index=110&type=chunk)[112](index=112&type=chunk) - The total long-term debt as a percentage of total capitalization decreased from **59.9%** at December 31, 2021 to **52.5%** at March 31, 2022[116](index=116&type=chunk) [Outlook](index=21&type=section&id=Outlook) The company aims for a 10% compounded annual return for shareholders over five years, expects the petroleum additives market to grow 1-2% annually, and plans to exceed this rate while continuing investments and evaluating cash uses like acquisitions, stock repurchases, and dividends - The company's stated goal is to provide a **10%** compounded return per year for shareholders over any five-year period, defined by EPS growth plus dividend yield[120](index=120&type=chunk) - Management expects the petroleum additives market will grow in the **1% to 2%** range annually for the foreseeable future, and the company plans to exceed that growth rate over the long-term[121](index=121&type=chunk) - The company's primary focus for acquisitions remains on the petroleum additives industry, and it will continue to evaluate all alternative uses of cash, including stock repurchases and dividends, to enhance shareholder value[123](index=123&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=21&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There were no material changes in market risk from the 2021 Annual Report, except for the elimination of marketable securities price risk and increased interest rate risk from higher variable-rate debt - Marketable securities price risk was eliminated due to the sale of all outstanding securities during the quarter[124](index=124&type=chunk) - At March 31, 2022, the company had **$199 million** in outstanding variable rate debt, where a hypothetical **10%** increase in variable interest rates would impact earnings and cash flow by approximately **$1.2 million** more than at December 31, 2021[125](index=125&type=chunk) [Controls and Procedures](index=21&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level as of the end of the period covered by this report[127](index=127&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2022, that materially affected, or are reasonably likely to materially affect, the company's internal controls[128](index=128&type=chunk) Part II [Legal Proceedings](index=22&type=section&id=ITEM%201.%20Legal%20Proceedings) There have been no material changes to the company's legal proceedings as disclosed in the 2021 Annual Report - No material changes to legal proceedings were reported for the quarter[130](index=130&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=22&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 115,796 shares of common stock for $37.3 million in Q1 2022 under its $500 million share repurchase program, with approximately $444 million remaining available as of March 31, 2022 Issuer Purchases of Equity Securities (Q1 2022) | Period | Total Number of Shares Purchased (shares) | Average Price Paid per Share ($) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs ($) | | :--- | :--- | :--- | :--- | | January 1 to January 31 | 15,359 | $333.89 | $476,686,367 | | February 1 to February 28 | 44,214 | $317.31 | $462,656,920 | | March 1 to March 31 | 56,223 | $323.52 | $444,467,566 | | **Total** | **115,796** | **$322.52** | **$444,467,566** | - A share repurchase program authorizing up to **$500 million** was approved on October 28, 2021, and is effective until December 31, 2024, with approximately **$444 million** remaining available as of March 31, 2022[131](index=131&type=chunk) [Exhibits](index=22&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including amended corporate documents, CEO and CFO certifications, and Inline XBRL documents - The report includes certifications from the Principal Executive Officer (Thomas E. Gottwald) and Principal Financial Officer (Brian D. Paliotti) pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[135](index=135&type=chunk) Signatures

PART I [Business](index=4&type=section&id=Item%201.%20Business) NewMarket Corporation is a global petroleum additives manufacturer operating through its subsidiary, Afton Chemical Corporation - NewMarket Corporation is a holding company whose primary business is the manufacturing and sale of petroleum additives through its subsidiary, Afton Chemical Corporation[12](index=12&type=chunk)[13](index=13&type=chunk)[15](index=15&type=chunk) - The company's business consists of one primary segment: petroleum additives, which are used in lubricating oils and fuels to enhance performance[21](index=21&type=chunk)[22](index=22&type=chunk)[24](index=24&type=chunk) - Afton is developing new technologies to meet evolving OEM requirements, including for hybrid and electric vehicles, focusing on improved fuel efficiency and reduced emissions[53](index=53&type=chunk)[54](index=54&type=chunk) - The company holds approximately **1,500 issued or pending patents** and actively protects its intellectual property[60](index=60&type=chunk) - In 2021, the company employed **2,104 people globally**, with approximately 1,100 in the United States, and the resignation rate from 2019-2021 was approximately **3.7%**[45](index=45&type=chunk)[47](index=47&type=chunk) Environmental and Safety Expenditures | Expense Type | 2021 ($ in millions) | 2020 ($ in millions) | 2019 ($ in millions) | | :--- | :--- | :--- | :--- | | Ongoing Environmental Operating & Clean-up Costs | 35 | 29 | 29 | | Capital Expenditures for Pollution Prevention & Safety | 17 | 17 | 8 | [Risk Factors](index=13&type=section&id=Item%201A.%20Risk%20Factors) The company faces material risks from raw material volatility, competition, operational disruptions, and regulatory changes - **Market & Supply Chain Risks:** Profitability is sensitive to raw material price changes and supply availability, and the company faces significant competition while relying on a small number of large customers[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) - **Operational Risks:** Disruption at a production facility could significantly impact profitability, alongside risks from R&D failures, IT system failures, and extraordinary events like the COVID-19 pandemic[81](index=81&type=chunk)[83](index=83&type=chunk)[94](index=94&type=chunk) - **Legislative & Regulatory Risks:** The business is subject to extensive governmental regulations, including environmental laws, which could lead to substantial compliance costs and liabilities[99](index=99&type=chunk)[102](index=102&type=chunk)[104](index=104&type=chunk) - **Financial & Economic Risks:** Substantial indebtedness could limit financial flexibility, and the company is exposed to foreign currency fluctuations, with **over 65% of 2021 net sales** outside the U.S[96](index=96&type=chunk)[110](index=110&type=chunk)[116](index=116&type=chunk) [Unresolved Staff Comments](index=20&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - None[119](index=119&type=chunk) [Properties](index=20&type=section&id=Item%202.%20Properties) The company owns its principal global research, manufacturing, and distribution facilities and believes capacity is sufficient - The company owns most of its principal operating properties, which include R&D, manufacturing, and distribution facilities globally[120](index=120&type=chunk) Key Operating Properties | Type | Locations | | :--- | :--- | | **Research, Development, and Testing** | Richmond, VA; Bracknell, England; Tsukuba, Japan; Ashland, VA; Suzhou, China | | **Manufacturing and Distribution** | Feluy, Belgium; Houston, TX; Jurong Island, Singapore; Sauget, IL; San Juan del Rio, Mexico | - Management believes that current plants and supply agreements are sufficient to meet expected sales levels[123](index=123&type=chunk) [Legal Proceedings](index=21&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal proceedings not expected to have a material adverse financial effect - The company is involved in incidental legal proceedings, including environmental matters, but does not expect them to have a material adverse effect on its financial condition[125](index=125&type=chunk)[126](index=126&type=chunk) [Mine Safety Disclosures](index=21&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company's operations - Not applicable[127](index=127&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's stock trades on the NYSE, with an active share repurchase program and a history of paying cash dividends - The company's common stock trades on the New York Stock Exchange (NYSE) under the symbol 'NEU'[129](index=129&type=chunk) - A new share repurchase program was authorized on October 28, 2021, allowing for the repurchase of up to **$500 million** of common stock, with approximately **$482 million** remaining available at year-end[131](index=131&type=chunk) Q4 2021 Share Repurchases | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Oct 1 to Oct 31 | 231,754 | $356.37 | | Nov 1 to Nov 30 | 5,055 | $333.44 | | Dec 1 to Dec 31 | 37,470 | $333.20 | | **Total** | **274,279** | **$352.78** | - Cash dividends declared and paid totaled **$8.00 per share** for 2021 and **$7.60 per share** for 2020[135](index=135&type=chunk) [Reserved](index=23&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Sales increased due to higher prices and volume, but operating profit declined due to rising raw material and energy costs - Petroleum additives net sales increased **17.1%** in 2021, but operating profit for the segment decreased by **15.7%** due to rising raw material and other costs[144](index=144&type=chunk) Net Sales by Segment (in millions) | Segment | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | **Petroleum additives** | | | | | Lubricant additives | $1,999 | $1,687 | $1,779 | | Fuel additives | $345 | $315 | $397 | | **Total Petroleum additives** | **$2,344** | **$2,002** | **$2,176** | | All other | $12 | $9 | $14 | | **Total Net sales** | **$2,356** | **$2,011** | **$2,190** | Segment Operating Profit (in millions) | Segment | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Petroleum additives | $281 | $333 | $359 | | All other | $(1) | $0 | $(2) | - Cash from operating activities was **$165 million** in 2021, a decrease from **$284 million** in 2020, primarily due to a **$116 million** increase in working capital requirements[170](index=170&type=chunk)[171](index=171&type=chunk) - The company issued **$400 million** of 2.70% senior notes in March 2021 and repurchased 566,671 shares of common stock for **$196 million** during the year[145](index=145&type=chunk)[178](index=178&type=chunk) - The company's outlook anticipates the petroleum additives market will grow **1-2% annually**, and it plans to exceed that rate over the long term[219](index=219&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=35&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exposed to market risks from securities prices, interest rates, foreign currency, and raw material costs - The company is exposed to market risks including prices of marketable securities, interest and foreign currency rates, and raw material costs[234](index=234&type=chunk) - **Marketable Securities Risk:** At year-end 2021, the company held **$376 million** in marketable securities, where a hypothetical 10% price decrease would result in a **$38 million** decrease in fair value[237](index=237&type=chunk) - **Interest Rate Risk:** Most long-term debt is fixed-rate, with **$148 million** of variable-rate debt outstanding at year-end 2021[238](index=238&type=chunk)[239](index=239&type=chunk) - **Foreign Currency Risk:** The company has significant exposure to foreign currency fluctuations, primarily with the Euro, British Pound, Japanese Yen, and Chinese Renminbi[240](index=240&type=chunk) - **Raw Material Price Risk:** Profitability is sensitive to changes in the cost and availability of key raw materials, and the company may not be able to pass all cost increases to customers[241](index=241&type=chunk) [Financial Statements and Supplementary Data](index=37&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the independent auditor's report and the company's consolidated financial statements for the past three years - The independent auditor, PricewaterhouseCoopers LLP, issued an **unqualified opinion** on the financial statements and internal controls over financial reporting as of December 31, 2021[246](index=246&type=chunk) - The auditor identified the valuation of the **pension benefit obligation** as a critical audit matter due to significant management judgment in determining the discount rate assumption[254](index=254&type=chunk)[255](index=255&type=chunk) Consolidated Income Statement Highlights (in thousands) | Metric | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Net Sales | $2,356,110 | $2,010,931 | $2,190,295 | | Gross Profit | $547,707 | $595,032 | $629,869 | | Operating Profit | $257,782 | $311,802 | $337,321 | | Net Income | $190,908 | $270,568 | $254,286 | | EPS - basic and diluted | $17.71 | $24.64 | $22.73 | Consolidated Balance Sheet Highlights (in thousands) | Metric | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Total Current Assets | $1,388,173 | $898,078 | | Total Assets | $2,558,436 | $1,933,875 | | Total Current Liabilities | $725,087 | $312,455 | | Long-term Debt | $789,853 | $598,848 | | Total Shareholders' Equity | $762,129 | $759,824 | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=75&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants - None[445](index=445&type=chunk) [Controls and Procedures](index=75&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective - Management concluded that the company's disclosure controls and procedures are effective at a reasonable assurance level as of December 31, 2021[446](index=446&type=chunk) - Based on an evaluation using the COSO framework, management concluded that internal control over financial reporting was effective as of December 31, 2021[450](index=450&type=chunk) [Other Information](index=76&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None[451](index=451&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=76&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This section is not applicable to the company - Not applicable[452](index=452&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=77&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, officers, and governance is incorporated by reference from the 2022 Proxy Statement - Information is incorporated by reference from the company's 2022 Proxy Statement[454](index=454&type=chunk) [Executive Compensation](index=77&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation is incorporated by reference from the 2022 Proxy Statement - Information is incorporated by reference from the company's 2022 Proxy Statement[456](index=456&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=77&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership is incorporated by reference, with details on equity compensation plans provided - Information regarding security ownership is incorporated by reference from the company's 2022 Proxy Statement[456](index=456&type=chunk) Equity Compensation Plan Information (as of Dec 31, 2021) | Plan Category | Securities to be Issued upon Exercise | Weighted-Average Exercise Price | Securities Remaining for Future Issuance | | :--- | :--- | :--- | :--- | | Approved by shareholders | 0 | $0 | 946,012 | | Not approved by shareholders | 0 | $0 | 0 | | **Total** | **0** | **$0** | **946,012** | [Certain Relationships and Related Transactions, and Director Independence](index=77&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on related transactions and director independence is incorporated by reference from the 2022 Proxy Statement - Information is incorporated by reference from the company's 2022 Proxy Statement[459](index=459&type=chunk) [Principal Accounting Fees and Services](index=78&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information on accounting fees and services is incorporated by reference from the 2022 Proxy Statement - Information is incorporated by reference from the company's 2022 Proxy Statement[460](index=460&type=chunk) PART IV [Exhibits, Financial Statement Schedules](index=79&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists all financial statements, schedules, and exhibits filed as part of the Form 10-K report - This section lists all exhibits filed with the Form 10-K, including corporate governance documents, debt agreements, compensation plans, and Sarbanes-Oxley certifications[461](index=461&type=chunk)[463](index=463&type=chunk)[465](index=465&type=chunk) - No financial statement schedules were required to be filed[461](index=461&type=chunk) [Form 10-K Summary](index=82&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company has not provided a summary for this item - None[467](index=467&type=chunk)

NewMarket Corporation (NYSE:NEU) Q4 2021 Earnings Conference Call February 3, 2022 3:00 PM ET Company Representatives Brian Paliotti - Vice President, Chief Financial Officer Conference Call Participants Operator Good afternoon ladies and gentlemen and welcome to the NewMarket Corporation Conference Call and webcast to review the Fourth Quarter 2021 and Full Year Financial Results. At this time all participants have been placed on a listen-only mode. It is now my pleasure to turn the floor over to your hos ...