NewMarket (US:NEU)2024-02-01 22:28Financial Data and Key Metrics Changes - Net income for Q4 2023 was $80 million or $8.38 per share, down from $91 million or $9.26 per share in Q4 2022. For the full year 2023, net income was $389 million or $40.44 per share, compared to $280 million or $27.77 per share in 2022 [5] - The decrease in operating profit was attributed to higher operating costs and lower shipments, partially offset by lower raw material costs [6] - The net debt-to-EBITDA ratio improved to 0.9 as of December 31, 2023, from 2.0 the previous year [20] Business Line Data and Key Metrics Changes - Petroleum additives operating profit for 2023 was $514 million, an increase from $378 million in 2022, driven by selling prices and a favorable product mix, despite lower shipments and higher costs [7] - Petroleum additives sales for Q4 2023 were $642 million, down from $680 million in Q4 2022. For the full year, sales were $2.7 billion compared to $2.8 billion in 2022 [16][17] - Shipments decreased by 10.7% in 2023 compared to 2022, with declines in lubricant and fuel additive shipments across all regions except Europe, which saw a slight increase in fuel additive shipments [18] Market Data and Key Metrics Changes - The overall global economic weakness and inventory rationalization in the chemical industry impacted shipments throughout 2023 [8] Company Strategy and Development Direction - The company is focused on managing operating costs, inventory levels, and portfolio profitability while continuing to invest in technology [19] - The acquisition of American Pacific Corporation for approximately $700 million is expected to be accretive to net income in 2024 and will enhance the company's capabilities in critical performance additives [10][21] - The company anticipates continued strength in the petroleum additives segment and looks forward to integrating AMPAC into its operations [22] Management's Comments on Operating Environment and Future Outlook - Management highlighted challenges from ongoing inflation and increased operating costs but expressed confidence in the fundamentals of the business and its long-term view [8][12] - The company remains committed to promoting long-term value for shareholders and customers [22] Other Important Information - The company generated solid cash flows in 2023, improving working capital by $134 million and returning $128 million to shareholders through dividends and share repurchases [9] - A new five-year $900 million revolving credit facility was established, along with a two-year $250 million unsecured term loan to enhance financial flexibility [11] Q&A Session Summary - The call concluded without specific questions being documented, indicating a focus on the prepared remarks and financial results [13][24]