Valvoline(VVV) - 2025 Q1 - Quarterly Results

Financial Performance - Valvoline reported Q1 2025 net revenues of $414.3 million, an 11$93.9 million, a 177% increase, with diluted earnings per share (EPS) of $0.73, up 181$102.8 million, reflecting a 14% increase, while adjusted EPS rose by 10% to $0.32[6] - Valvoline reported a net income of$91.6 million for the three months ended December 31, 2024, compared to $31.9 million in the same period of 2023, representing a significant increase[19] - Reported diluted earnings per share from continuing operations increased to$0.73, up from $0.26 in the prior year[24] - Adjusted EBITDA from continuing operations was$102.8 million, compared to $90.2 million in the same quarter of 2023, indicating improved operational performance[26] - Valvoline's net profit margin for the quarter was 22.7$820 million[6] - System-wide store sales reached $820.3 million, reflecting a year-over-year growth of 13.5$722.9 million in 2023[20] - Same-store sales growth for company-operated stores was 8.2%, while franchised stores saw a growth of 7.8%[20] - The total number of system-wide stores increased to 2,045, marking an 8.2% year-over-year growth from 1,890 stores[20] - The company added 35 stores in the quarter, including 14 franchise stores, bringing the total system-wide store count to 2,045[6] - The company opened 15 new company-operated stores during the first quarter of 2025, while 14 franchised stores were opened[22] Cash Flow and Debt - Valvoline's cash and cash equivalents stood at $60 million, with total debt of$1.0 billion[7] - Operating cash flow from continuing operations was $41 million, while free cash flow was negative at ($12) million[7] - Free cash flow from continuing operations was reported at $(12.2) million, a decrease from$(20.4) million in the previous year[29] - Valvoline's operating cash flows from continuing operations were $41.4 million, up from$21.9 million in the same period last year[29] - The company returned $39 million to shareholders through share repurchases, with$346 million remaining under the share repurchase authorization[7] Strategic Goals and Guidance - Valvoline aims to grow its network to over 3,500 stores through new builds, acquisitions, and franchise support[3] - The company remains on track for its full-year guidance following the completion of recent refranchising projects[7] Non-GAAP Measures and Expenses - Management uses non-GAAP measures to exclude unusual, infrequent, or non-operational activities impacting comparability of operational results[35] - Net pension and other postretirement plan expenses are influenced by changes in plan assets and obligations driven by debt and equity markets, reflecting current global market conditions[37] - Legacy and separation-related expenses include costs associated with the separation from Valvoline's former parent company and adjustments to indemnity obligations[38] - Information technology transition costs are incurred for implementing stand-alone enterprise resource planning and human resource information systems, beginning in fiscal 2023[39] - Investment and divestiture-related income includes costs associated with significant acquisitions and divestitures, which are not reflective of ongoing operational performance[40]