Exhibit 99.1


ingevitylogorgba10.jpg
 
Ingevity Corporation
5255 Virginia Avenue
North Charleston, SC 29406 USA
www.ingevity.com
 
 
 
News
 
Contact:
Jack Maurer
843-746-8242
jack.maurer@ingevity.com
 
 
 
 
 
Investors:
Dan Gallagher
843-740-2126
daniel.gallagher@ingevity.com

Net sales of $276.8 million were up 17.7% versus the prior year quarter’s sales of $235.2 million
Net income of $22.7 million was down 36.6% versus net income in the prior year quarter of $35.8 million primarily due to acquisition costs; net income as a percentage of sales was 8.2%, compared to 15.2% in the prior year quarter; diluted earnings per share were $0.54 compared to $0.72
Adjusted earnings of $41.9 million were up 23.6% versus adjusted earnings in the prior year quarter of $33.9 million; diluted adjusted earnings per share were $0.99 versus $0.79 in the prior year quarter
Adjusted EBITDA of $83.5 million were up 24.4% compared to first quarter 2018 adjusted EBITDA of $67.1 million; adjusted EBITDA margin of 30.2% increased 170 basis points versus first quarter 2018
Company maintains fiscal year 2019 guidance for sales from between $1.30 billion and $1.36 billion and adjusted EBITDA from between $390 million and $410 million

The results and guidance in this release include Non-GAAP financial measures. Refer to the section entitled “Use of Non-GAAP Financial Measures” within this release.

NORTH CHARLESTON, S.C., May 1, 2019
- Ingevity Corporation (NYSE:NGVT) today reported first quarter net sales of $276.8 million, representing an increase of 17.7% versus $235.2 million in the prior year’s first quarter. Net income of $22.7 million, decreased 36.6% versus $35.8 million in the previous year’s quarter primarily due to higher costs related to our acquisition of the CapaTM caprolactone business from Perstorp Holding AB. Ingevity’s first quarter net income margin was 8.2% versus 15.2% in the first quarter of 2018. The first quarter diluted earnings per share were $0.54 compared to $0.72 in the prior year period.

Adjusted earnings of $41.9 million were up 23.6% versus prior year quarter of $33.9 million. Diluted adjusted earnings per share were $0.99 excluding certain items of $0.45 per share which are primarily costs related to the acquisition of the Capa caprolactone business, net of discrete tax benefits recognized during the quarter. This compares to adjusted earnings per share of $0.79 in the prior year quarter. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $83.5 million were up 24.4% versus first quarter 2018 adjusted EBITDA of $67.1 million. Adjusted EBITDA margin of 30.2% was up 170 basis points from the prior year’s first quarter adjusted EBITDA margin of 28.5%.

“Our first quarter performance was in line with our expectations,” said Michael Wilson, Ingevity’s president and CEO. “We benefitted from continued strong growth in our Performance Materials segment and from price and mix improvements in our legacy Performance Chemicals applications. In addition, our newly acquired engineered polymers product line contributed significantly to the Performance Chemicals segment. In terms of our adjusted EBITDA, the positive revenue impacts were partially offset by higher selling, general and administrative, or SG&A, costs - including legal expenses - and higher logistics and transportation costs. Nonetheless, we drove strong revenue drop-through posting a 24% increase in adjusted EBITDA on an 18% increase in revenues and achieved an adjusted EBITDA margin of 30%.

“We are continuing to execute on our strategy and maintaining our focus on earnings growth and margin accretion,” Wilson continued. “This includes intentionally transitioning to higher margin specialty applications while backing away from volumes that don’t meet our profitability objectives.”

Performance Chemicals

First quarter 2019 sales in the Performance Chemicals segment were $167.7 million, up $28.0 million, or 20.0%, versus the first quarter 2018. Segment EBITDA were $32.3 million, up $7.4 million, or 29.7%, versus the prior year quarter segment EBITDA. Segment EBITDA margin rose 150 basis points to 19.3%.

“Increased sales to oilfield applications were driven primarily by demand for production chemicals as opposed to drilling chemicals,” Wilson said. “Sales in industrial specialties applications decreased as we selectively shed sales to low-margin applications and focused on higher profit opportunities. And, sales to pavement technologies customers were fundamentally flat versus the prior year’s period in what is a seasonally slower quarter.”

Wilson said that the largest contributor to the Performance Chemicals segment’s results was the addition of the engineered polymers product line, formed through the acquisition of the Capa caprolactone business which closed mid-quarter. “The engineered polymers team didn’t skip a beat and delivered results slightly higher than our expectations.”

Performance Materials

First quarter 2019 sales in the Performance Materials segment were $109.1 million, up $13.6 million, or 14.2%, versus the first quarter 2018. Segment EBITDA were $51.2 million, up $9.0 million, or 21.3%, versus the prior year segment EBITDA. Segment EBITDA margin rose 270 basis points to 46.9%.

“Adoption of Ingevity’s patented U.S. Tier 3 and LEV III gasoline vapor emission solutions, particularly our ‘honeycomb’ scrubber products, by automotive customers once again fueled growth in our Performance Materials segment,” Wilson said. “Our growth in this application enabled us to achieve a record segment EBITDA for any quarter, despite reduced North American and Chinese auto production in the period.”

Wilson added that implementation by automakers of the nationwide China 6 gasoline vapor emission control standard is beginning to benefit sales and product mix in the Performance Materials segment. “During the quarter, sales volumes of pelletized carbon used in base evaporative emissions canisters increased dramatically. This trend signals the impending broad implementation of more stringent standards by OEMs in China in advance of the nationwide regulation,” he said.

Outlook

Ingevity maintained its fiscal year 2019 guidance for sales from between $1.30 billion and $1.36 billion and adjusted EBITDA from between $390 million and $410 million.

“Despite some moderate macroeconomic headwinds, we’re exactly where we expected to be at this stage of the year,” Wilson said. “We’re working to enhance margins and profitability in Performance Chemicals, rapidly integrate the engineered polymers product line, and deliver on the growing global demand in Performance Materials. We expect to turn in another strong performance in 2019.”

Ingevity: Purify, Protect and Enhance
Ingevity provides specialty chemicals, high-performance carbon materials and engineered polymers that purify, protect, and enhance the world around us. Through a team of talented and experienced people, Ingevity develops, manufactures, and brings to market products and processes that help customers solve complex problems. These products are used in a variety of demanding applications, including asphalt paving, oil exploration and production, agrochemicals, adhesives, lubricants, publication inks, coatings, elastomers, bio-plastics and automotive components that reduce gasoline vapor emissions. Headquartered in North Charleston, South Carolina, Ingevity operates from 25 locations around the world and employs approximately 1,750 people. The company is traded on the New York Stock Exchange (NYSE: NGVT). For more information visit www.ingevity.com.

Additional Information
The company will host a live webcast on Thursday, May 2, 2019, at 10 a.m. (Eastern Time) to discuss first quarter fiscal results. The webcast can be accessed through the Investors section of Ingevity’s website at www.ingevity.com. You may also listen to the conference call by dialing 877-407-2991 (inside the U.S.) or 201-389-0925 (outside the U.S.), at least 10 minutes prior to the start of the event. Information on how to access the webcast and conference call, along with a slide deck containing other relevant financial and statistical information, will be posted to the Investors section of Ingevity’s website prior to the call. For those unable to join the live event, a replay of the webcast will be available beginning at approximately 2 p.m. (Eastern Time) on May 2, 2019, through June 2, 2019.


Use of Non-GAAP Financial Measures

Ingevity has presented certain financial measures which have not been prepared in accordance with U.S. generally accepted accounting principles (GAAP). Definitions of our non-GAAP financial measures and a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP are included in the financial schedules accompanying this news release, under the section entitled "Non-GAAP Financial Measures." 

A reconciliation of net income to adjusted EBITDA as projected for 2019 is not provided. Ingevity does not forecast net income as it cannot, without unreasonable effort, estimate or predict with certainty various components of net income. These components, net of tax, include further restructuring and other income (charges), net; additional acquisition and other related costs in connection with the acquisition of Georgia-Pacific’s pine chemical business and Perstorp Holding AB’s Capa caprolactone business; additional pension and postretirement settlement and curtailment (income) charges; and revisions due to future guidance and assessment of U.S. tax reform. Additionally, discrete tax items could drive variability in our projected effective tax rate. All of these components could significantly impact such financial measures. Further, in the future, other items with similar characteristics to those currently included in adjusted EBITDA, that have a similar impact on comparability of periods, and which are not known at this time, may exist and impact adjusted EBITDA.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements generally include the words “may,” “could,” “should,” “believes,” “plans,” “intends,” “targets,” “will,” “expects,” “suggests,” “anticipates,” “outlook,” “continues,” “forecast,” “prospect,” “potential” or similar expressions. Forward-looking statements may include, without limitation, expected financial positions, results of operations and cash flows; financing plans; business strategies and expectations; operating plans; synergies and the potential benefits of the acquisition of Georgia-Pacific’s pine chemicals business and the acquisition of Perstorp Holding AB’s Capa caprolactone business (the “acquisitions”); capital and other expenditures; competitive positions; growth opportunities for existing products; benefits from new technology and cost-reduction initiatives, plans and objectives; markets for securities and expected future repurchase of shares, including statements about the manner, amount and timing of repurchases. Like other businesses, Ingevity is subject to risks and uncertainties that could cause its actual results to differ materially from its expectations or that could cause other forward-looking statements to prove incorrect. Factors that could cause actual results to materially differ from those contained in the forward-looking statements, or that could cause other forward-looking statements to prove incorrect, include, without limitation, risks that the expected benefits from the acquisitions will not be realized or will not be realized in the expected time period; the risk that the acquired businesses will not be integrated successfully; significant transaction costs; unknown or understated liabilities; general economic and financial conditions; international sales and operations; currency exchange rates and currency devaluation; compliance with U.S. and foreign regulations; competition from infringing intellectual property activity; attracting and retaining key personnel; the impact of Brexit; conditions in the automotive market or adoption of alternative technologies; worldwide air quality standards; a decrease in government infrastructure spending; declining volumes and downward pricing in the printing inks market; the limited supply of crude tall oil (“CTO”); lack of access to sufficient CTO; access to and pricing of raw materials; competition from producers of alternative products and new technologies, and new or emerging competitors; a prolonged period of low energy prices; the provision of services by third parties at several facilities; natural disasters, such as hurricanes, winter or tropical storms, earthquakes, floods, fires; other unanticipated problems such as labor difficulties including renewal of collective bargaining agreements, equipment failure or unscheduled maintenance and repair; protection of intellectual property and proprietary information; information technology security breaches and other disruptions; government policies and regulations, including, but not limited to, those affecting the environment, climate change, tax policies, tariffs and the chemicals industry; and lawsuits arising out of environmental damage or personal injuries associated with chemical or other manufacturing processes. These and other important factors that could cause actual results or events to differ materially from those expressed in forward-looking statements that may have been made in this document are and will be more particularly described in our filings with the U.S. Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2018 and our other periodic filings.  Readers are cautioned not to place undue reliance on Ingevity’s projections and forward-looking statements, which speak only as the date thereof. Ingevity undertakes no obligation to publicly release any revision to the projections and forward-looking statements contained in this announcement, or to update them to reflect events or circumstances occurring after the date of this announcement. 




The following information was filed by Ingevity Corp (NGVT) on Wednesday, May 1, 2019 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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