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NewMarket (NEU) - 2020 Q2 - Quarterly Report
2020-07-30 14:26
Financial Performance - Consolidated net sales for Q2 2020 totaled $410.9 million, a decrease of $152.6 million, or 27.1%, from Q2 2019[84]. - Petroleum additives net sales for the first six months of 2020 were $966.1 million, down 11.7% from $1.1 billion in the same period of 2019[87]. - Shipments to customers in Q2 2020 were down 25.1% from Q1 2020, with North America and EMEAI regions experiencing the most significant decreases[77]. - The operating profit margin for petroleum additives was 8.1% in Q2 2020, compared to 18.4% in Q2 2019[99]. - Petroleum additives operating profit decreased by $69.9 million in Q2 2020 compared to Q2 2019, and by $44.1 million in the first six months of 2020 compared to the same period in 2019[96]. - The volume of product shipments for petroleum additives decreased 24.4% in Q2 2020 compared to Q2 2019, and 9.6% for the first six months of 2020 compared to the same period in 2019[91]. - Cost of goods sold as a percentage of net sales was 76.5% for Q2 2020, up from 69.5% in Q2 2019[100]. - The impact of COVID-19 has led to lower demand for petroleum additives products, significantly affecting net sales and operating profit margins[88]. Expenses and Investments - SG&A expenses for Q2 2020 were $1.3 million, or 4.4% lower than Q2 2019, and represented 7.2% of net sales compared to 5.5% in Q2 2019[102]. - R&D investment decreased by $3.6 million in Q2 2020 compared to Q2 2019, accounting for 8.2% of net sales versus 6.6% in Q2 2019[103]. - Interest and financing expenses were $7.0 million in Q2 2020, down from $7.7 million in Q2 2019, primarily due to lower average interest rates[105]. - Other income for Q2 2020 was $6.5 million, an increase from $5.8 million in Q2 2019, reflecting components of net periodic benefit cost[106]. - Income tax expense for Q2 2020 was $4.9 million, significantly lower than $22.5 million in Q2 2019, with an effective tax rate of 18.0% compared to 23.3%[107]. Cash Flow and Debt - Cash and cash equivalents decreased by $42.3 million to $102.1 million as of June 30, 2020, compared to December 31, 2019[110]. - Cash flows from operating activities for the first six months of 2020 were $94.3 million, with $60.1 million used for higher working capital requirements[114]. - Total long-term debt increased to $690.3 million as of June 30, 2020, from $642.9 million at December 31, 2019[119]. Future Outlook - The company expects the petroleum additives market to grow at 1% to 2% annually, with plans to exceed this growth rate in the long term[127]. - The company aims to provide a 10% compounded return per year for shareholders over any five-year period, focusing on customer-centric strategies and technology-driven solutions[126]. Strategic Initiatives - The company has a strong financial position with access to a $900 million revolving credit facility established in March 2020[81]. - The company continues to invest in organizational talent, technology development, and global infrastructure despite the current economic challenges[76].
NewMarket (NEU) - 2020 Q1 - Earnings Call Transcript
2020-04-23 22:48
Financial Data and Key Metrics Changes - Net income for Q1 2020 was $85.5 million, or $7.67 per share, compared to $62.2 million, or $5.57 per share in Q1 2019, representing a significant increase [5] - The effective income tax rate decreased to 22.3% from 23% year-over-year [8] - Capital expenditures for the quarter were $20.1 million, with dividends paid amounting to $21.2 million and share repurchases totaling $94.3 million [8] - The company maintained a low leverage with a net debt-to-EBITDA ratio of 1.2 times [9] Business Line Data and Key Metrics Changes - Petroleum additives net sales increased to $557.4 million in Q1 2020 from $532.7 million in Q1 2019, marking a 4.6% increase [6] - Operating profit for petroleum additives rose to $113.7 million from $87.9 million year-over-year, driven by higher shipments and lower conversion costs [7] Market Data and Key Metrics Changes - The increase in lubricant additive shipments was primarily driven by Europe, North America, and Latin America, while Asia Pacific experienced a decrease [6] - The company anticipates a significant decline in shipments for passenger vehicle lubricants and fuels, particularly in Europe and the Americas, due to COVID-19 impacts [13] Company Strategy and Development Direction - The company is focused on maintaining operations and meeting customer needs during the COVID-19 crisis, ensuring supply chain continuity and product availability [12] - Management emphasized long-term planning and resilience in navigating short-term challenges, with a positive outlook for recovery as restrictions ease [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance despite expecting a downturn in Q2 2020 due to social distancing measures affecting business operations [13] - The company is encouraged by early recovery signs in its China business and remains optimistic about global market recovery [14] Other Important Information - The company has taken steps to support local communities by providing protective equipment to hospitals and fire departments during the pandemic [16] - Management highlighted the essential role of the chemical and oil industries in combating COVID-19 and ensuring the supply of critical products [16] Q&A Session Summary - The Q&A session concluded without specific questions being documented, indicating a focus on the company's remarks and future outlook [21]
NewMarket (NEU) - 2020 Q1 - Quarterly Report
2020-04-23 14:53
Table of Contents 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, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to UNITED STATES SECURITIES AND EXCHANGE COMMISSION Commission File Number 1-32190 NEWMARKET CORPORATION (Exact name of registrant as specified in its charter) Virginia 20-0812170 (State or other juri ...
NewMarket (NEU) - 2019 Q4 - Annual Report
2020-02-18 15:35
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 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 Incorporated pursuant to the Laws of the Commonwealth of Virginia Internal Revenue Service Employer ...
NewMarket (NEU) - 2019 Q4 - Earnings Call Transcript
2020-02-04 21:26
NewMarket Corporation (NYSE:NEU) Q4 2019 Earnings Conference Call February 4, 2020 3:00 PM ET Company Participants Brian Paliotti - Chief Financial Officer Conference Call Participants Operator Ladies and gentlemen, hello, and thank you all for joining today's NewMarket Corporation Fourth Quarter 2019 and Year-End Financial Results Conference Call. We'll jump right in. And I'm pleased to turn the floor over to your host Mr. Brian Paliotti. Please go ahead sir. Brian Paliotti Thank you, Jim and thanks to eve ...
NewMarket (NEU) - 2019 Q3 - Earnings Call Transcript
2019-10-24 20:56
NewMarket Corporation (NYSE:NEU) Q3 2019 Earnings Conference Call October 24, 2019 3:00 PM ET Company Participants Brian Paliotti - Chief Financial Officer Conference Call Participants Dmitry Silversteyn - Buckingham Research Operator Ladies and gentlemen, good day, and thank you all for joining this NewMarket Corporation Conference Call and Webcast to review Third Quarter 2019 Financial Results. [Operator Instructions] And now for opening remarks and introductions, I'm pleased to turn the floor over to you ...
NewMarket (NEU) - 2019 Q3 - Quarterly Report
2019-10-24 14:25
Financial Performance - Consolidated net sales for Q3 2019 totaled $555.8 million, a decrease of $7.3 million, or 1.3%, from Q3 2018[83] - Petroleum additives net sales for the first nine months of 2019 were $1.6 billion, down 5.7% from $1.7 billion in the same period of 2018[86] - Operating profit for petroleum additives increased by $19.0 million in Q3 2019 compared to Q3 2018, and by $54.1 million for the first nine months of 2019 compared to the same period in 2018[95] - The operating profit margin for petroleum additives was 17.2% in Q3 2019, up from 13.5% in Q3 2018, and 17.4% for the first nine months of 2019, compared to 13.3% in the same period of 2018[96] - The decrease in petroleum additives net sales for the first nine months of 2019 was attributed to lower product shipments across all regions, with the most significant decline in the EMEAI region[86] Expenses and Taxation - Research and development (R&D) expenses as a percentage of net sales were 6.6% for Q3 2019, compared to 6.3% for Q3 2018[100] - Selling, general, and administrative expenses (SG&A) decreased by $0.6 million, or 1.9%, in Q3 2019 compared to Q3 2018, and by $10.2 million, or 9.9%, for the first nine months of 2019 compared to the same period in 2018[99] - Interest and financing expenses were $7.0 million for Q3 2019, down from $7.8 million in Q3 2018, primarily due to lower average debt outstanding[101] - Income tax expense for Q3 2019 was $19.7 million, with an effective tax rate of 22.5%, compared to $9.8 million and 14.4% in Q3 2018[103] - Income tax expense for the first nine months of 2019 was $60.8 million, up from $47.3 million in the same period of 2018, with an effective tax rate increase from 21.6% to 22.9%[104] Cash Flow and Capital Structure - Cash and cash equivalents increased to $80.0 million as of September 30, 2019, a rise of $6.9 million since December 31, 2018[106] - Cash flows from operating activities for the first nine months of 2019 were $233.2 million, which included $36.0 million used for higher working capital requirements[110] - Total working capital was $546.5 million at September 30, 2019, compared to $542.1 million at December 31, 2018, with a current ratio of 2.95 to 1[113] - Cash used in investing activities totaled $37.1 million during the first nine months of 2019, with total capital spending expected to be in the range of $60 million to $70 million for the year[114] - Long-term debt decreased from $771.0 million at December 31, 2018, to $640.0 million at September 30, 2019, resulting in a long-term debt percentage of total capitalization dropping from 61.1% to 50.4%[116][119] Strategic Outlook - The company expects the petroleum additives market to grow at an annual rate of 1% to 2%, with plans to exceed this growth rate over the long term[124] - Significant investments have been made in organizational talent, technology development, and global infrastructure to enhance operating results and customer solutions[125] - The company remains focused on the petroleum additives industry for future acquisitions, viewing it as a segment with solid return opportunities while minimizing risk[126] - The company aims to provide a 10% compounded return per year for shareholders over any five-year period, emphasizing a long-term view and customer-focused strategy[123]
NewMarket (NEU) - 2019 Q2 - Earnings Call Transcript
2019-08-03 02:37
NewMarket Corporation (NYSE:NEU) Q2 2019 Earnings Conference Call August 1, 2019 3:00 PM ET Company Participants Brian Paliotti - Vice President & Chief Financial Officer Teddy Gottwald - Chairman & Chief Executive Officer Conference Call Participants Dmitry Silversteyn - Buckingham Research Haruki Toyama - Madison Investment Operator Good day, ladies and gentlemen, and welcome to the NewMarket Corporation Conference Call and Webcast to Review Second Quarter 2019 Financial Results. All lines have been place ...
NewMarket (NEU) - 2019 Q2 - Quarterly Report
2019-08-01 13:35
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 June 30, 2019 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 juris ...
NewMarket (NEU) - 2019 Q1 - Earnings Call Transcript
2019-04-25 22:13
Financial Data and Key Metrics Changes - Net income for Q1 2019 was $62.2 million or $5.57 per share, an increase of 2.7% in net income and 8.4% in EPS compared to Q1 2018 [5] - Petroleum additives net sales decreased to $532.7 million, down 9.2% from $586.9 million in the same period last year, attributed to a 12.5% decrease in shipments [5][6] - Operating profit for petroleum additives was $87.9 million, a 4.4% increase from $84.1 million in Q1 2018, driven by changes in selling prices and raw materials [6] - The effective income tax rate decreased to 23% from 25.5% year-over-year [7] Business Line Data and Key Metrics Changes - Shipments of lubricant and fuel additives decreased across all regions except for Asia Pacific, which saw an increase in fuel additive shipments [6] - The operating margin for the rolling four quarters, including Q1 2019, was 14.1%, with a focus on improving margins throughout 2019 [6][25] Market Data and Key Metrics Changes - The company experienced mid- to high single-digit declines in revenues in the United States and China, while EMEA and other foreign markets saw low teens declines [17] - Approximately 25% of the shipment decline can be attributed to identifiable one-off issues, particularly in regions with larger declines [18][20] Company Strategy and Development Direction - The company plans to continue focusing on margin improvement and expects capital expenditures in the range of $75 million to $85 million for 2019, consistent with 2018 levels [8][9] - Investments have been made in people, technology, technical centers, and production capacities to enhance capabilities and shareholder value [8][9] Management's Comments on Operating Environment and Future Outlook - Management views the current softness in demand as a short-term issue, with confidence in a recovery based on stable industry demand [12][13] - The company does not anticipate significant inventory trimming by customers, as demand is not highly sensitive to small economic changes [15] Other Important Information - Higher conversion costs were noted, attributed to general manufacturing costs across the network [28][29] - The tax rate for 2019 is expected to remain in the 23% to 24% range, similar to the first quarter [30] Q&A Session Summary Question: What is the reason for the double-digit declines in volumes in a growing market? - Management acknowledged the unusual nature of the declines and attributed it to short-term issues, with no significant loss of business [12][13] Question: What gives confidence in a reversal of the current trend? - Confidence stems from the stable nature of industry demand, which does not typically vary greatly year-to-year [13] Question: Can you provide details on the geographic revenue declines? - Larger declines in certain regions were attributed to identifiable one-off issues, with 25% of the change in shipments linked to these factors [18][20] Question: What is driving the positive performance in Asia Pacific? - The positive performance is attributed to a combination of economic growth and increased transportation modes driving fuel consumption [22] Question: How should margins be expected to progress sequentially? - Management is focused on margin recovery and aims to return to mid- to high-teens margins [25] Question: What are the factors behind higher conversion costs? - Higher conversion costs are due to a combination of factors, including general increases in production costs across the network [29] Question: What is the expected tax rate for 2019? - The tax rate is expected to be in the 23% to 24% range for the full year, consistent with Q1 [30]