EXHIBIT 99.1
NewMarket Corporation Reports Fourth Quarter and Full Year 2017 Results
| |
• | Petroleum Additives Fourth Quarter Operating Profit of $77.9 Million, Up 3.0%, and Full Year Operating Profit of $359.8 Million, Down 6.5% |
| |
• | Petroleum Additives Fourth Quarter Shipments Up 8.0%, and Full Year Shipments Up 8.2% |
| |
• | $31.4 Million Tax Charge in Fourth Quarter Related to U.S. Tax Reform Legislation |
Richmond, VA, February 6, 2018 – NewMarket Corporation (NYSE:NEU) Chairman and Chief Executive Officer, Thomas E. Gottwald, released the following earnings report of the Company’s operations for the fourth quarter and full year 2017. Profit before income taxes for the fourth quarter of 2017 was $64.9 million compared to $64.0 million for the fourth quarter of 2016. Net income for the fourth quarter of 2017 was $4.1 million, or $.35 per share, compared to net income of $45.7 million, or $3.86 per share, for the fourth quarter of 2016. Profit before income taxes for 2017 was $315.4 million compared to $343.2 million for 2016. Net income for 2017 was $190.5 million, or $16.08 per share, compared to net income of $243.4 million, or $20.54 per share, for 2016. Net income for both 2017 periods included the estimated impact of the tax reform act enacted on December 22, 2017, commonly known as the “Tax Cuts and Jobs Act” (the “Tax Reform Act”).
Sales for the petroleum additives segment for the fourth quarter of 2017 were $556.9 million, up 11.4% versus the same period last year. Petroleum additives operating profit for the fourth quarter of 2017 was $77.9 million, 3.0% higher than fourth quarter operating profit last year of $75.6 million. The increase was mainly due to increased shipments, changes in selling prices and product mix, partially offset by higher raw material and conversion costs. Shipments were up 8.0% from the same period last year with increases in both lubricant additives and fuel additives shipments. All regions contributed to the increase in lubricant additives shipments, and Europe was the primary driver of the increase in fuel additives shipments.
For the year, petroleum additives sales were $2.2 billion compared to sales in 2016 of $2.0 billion, or an increase of 7.5%. Petroleum additives operating profit for 2017 was $359.8 million, 6.5% lower than last year’s $384.9 million. The decrease was due mainly to higher raw material and conversion costs, and changes in selling prices and product mix, partially offset by increased shipments. Throughout much of 2017, we faced headwinds with raw material costs rising, and our margins suffered as we were unable to adjust often and fast enough to compensate for the cost increases. Our efforts to recover these cost increases are continuing. Shipments increased 8.2% versus 2016 with increases in both lubricant additives and fuel additives shipments. Europe, Asia Pacific and Latin America were the regions contributing to the increase in lubricant additives shipments, and Europe was the primary driver of the increase in fuel additives shipments.
Income tax expense was $60.9 million for the fourth quarter of 2017 compared to $18.3 million for the fourth quarter of 2016, and $124.9 million for 2017 compared to $99.8 million for 2016. The primary driver for the increase in income tax expense in both comparative periods was a one-time deemed repatriation tax on untaxed accumulated foreign earnings as a result of the Tax Reform Act. We recorded $31.4 million in additional income tax expense in the fourth quarter of 2017 related to our estimate of the total effects of the Tax Reform Act, and will continue to assess the impact of the new law. In addition, the fourth quarter included the impact of recording certain deferred tax liabilities associated with our Singapore plant.
During the year, we strengthened our ability to serve our customers worldwide by completing the construction of Phase 2 of our Singapore manufacturing facility and our acquisition of Aditivos Mexicanos, S.A. de C.V., a petroleum additives manufacturing, sales and distribution company based in Mexico City, Mexico. These investments along with other capital expenditures, totaled $332.6 million, and they position us well for future growth. We also returned $110.7 million to our shareholders through dividends ($82.9 million) and share repurchases (70,689 shares of our common stock
The following information was filed by Newmarket Corp (NEU) on Tuesday, February 6, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.