NewMarket Q3 2025 Earnings Report

NewMarket EPS Results

• Actual EPS: $10.67
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

NewMarket Revenue Results

• Actual Revenue: $690.31 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

NewMarket Announcement Details

• Quarter: Q3 2025
• Date: 10/30/2025
• Time: After Market Closes
• Conference Call Date: Friday, October 31, 2025
• Conference Call Time: 3:00PM ET

NewMarket (NYSE:NEU) is a specialty chemicals and lubricants company headquartered in Richmond, Virginia. Through its Valvoline business, the company markets a broad portfolio of automotive aftermarket products, including engine oils, transmission fluids, greases and vehicle care solutions. Valvoline products are distributed through retail and commercial channels as well as a network of quick-lube service centers that provide oil changes, preventive maintenance and related services.

In its chemical additives segment, NewMarket develops, manufactures and sells performance additives for fuels, lubricants and industrial fluids. These additives are engineered to improve fuel economy, reduce emissions, extend equipment life and enhance engine cleanliness across on-road, off-road and marine applications. The division serves customers in transportation, energy, manufacturing and other heavy-duty industrial markets worldwide.

Founded in 1919, NewMarket has expanded its global footprint through strategic acquisitions and internal growth. The company operates manufacturing and technical centers in North America, Europe, Asia Pacific and Latin America to support local market needs and regulatory requirements. NewMarket’s leadership team emphasizes investment in research and development to advance formulation technologies that meet evolving environmental standards and performance expectations.

NewMarket Q3 2025 Earnings Call Transcript

Key Takeaways

• Negative Sentiment: Net income declined to $100 million ($10.67/share) in Q3 2025 from $132 million ($13.79/share) a year earlier, with year-to-date net income also down modestly to $337 million from $352 million.
• Negative Sentiment: Petroleum additives results weakened as Q3 operating profit fell to $131 million (from $157 million) due to one-time manufacturing optimization charges, a 4%-plus decline in shipments, higher R&D, and ongoing inflation and tariff pressures.
• Positive Sentiment: Specialty materials is a strategic growth area: despite quarterly volatility, year-to-date operating profit improved and the company completed the acquisition of Calca, part of ~$1 billion committed since 2024 to expand this higher‑technology segment.
• Positive Sentiment: Strong cash generation funded $155 million returned to shareholders (including $77 million of buybacks), and management reduced net debt by $213 million, bringing net debt-to-EBITDA to 0.9 times.
• Positive Sentiment: The Board approved a 9% quarterly dividend increase to $3.00 per share, payable January 2, 2026, signaling continued shareholder returns.

Presentation

[Operator]

Good day, everyone, and welcome to the NewMarket Corporation conference call and webcast to review third quarter 2025 financial results. At this time, all participants are placed on a listen-only mode. It is now my pleasure to turn the floor over to your host, Tim Fitzgerald, Vice President and CFO. Sir, the floor is yours.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Thank you, Matthew, and thanks to everyone for joining me this afternoon. As a reminder, some of the statements made during this conference call may be forward-looking. Relevant factors that could cause actual results to differ materially from those forward-looking statements are contained in our earnings release and in our SEC filings, including our most recent Form 10-K. During this call, we will also discuss the non-GAAP financial measures included in our earnings release. The earnings release, which can be found on our website, includes a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. We filed our 10-Q for the third quarter of 2025 earlier today, and it contains significantly more details on the operations and performance of our company.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Today, I will be referring to the data that was included in last night's press release. Net income for the third quarter of 2025 was $100 million, or $10.67 per share, compared to net income of $132 million, or $13.79 per share, for the third quarter of 2024. Net income for the first nine months of 2025 was $337 million, or $35.78 per share, compared to net income of $352 million, or $36.66 per share, for the first nine months of 2024. Petroleum additive sales for the third quarter of 2025 were $649 million, compared to $663 million for the same period in 2024. Petroleum additive operating profit for the third quarter of 2025 was $131 million, compared to $157 million for the third quarter of 2024, which was a record quarter for this segment.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

The decrease in operating profit compared to the prior year was primarily driven by one-time charges during the quarter, including those related to optimizing our global manufacturing network, which will enable us to deliver products to our customers more efficiently in the years ahead. A 4.1% decline in shipments between quarterly periods and an increase in R&D investments to support our customer needs also contributed to the decrease in petroleum additive operating profit. For the first nine months of 2025, sales for the petroleum additive segment were $1.9 billion, compared to $2 billion for the same period in 2024. Petroleum additive operating profit for the first nine months of 2025 was $413 million, compared to $456 million for the same period in 2024. The drivers for the decrease in operating profit were consistent with those affecting the third quarter comparison.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Shipments were down by 4.6% when comparing the first nine months of 2025 with the same period in 2024, driven by softness in the market and our strategic decision to manage the profitability of our portfolio by reducing low-margin business. We are very pleased with the performance of our petroleum additives business during the first nine months of 2025. However, we remain challenged by the ongoing inflationary environment and the impact of tariffs, as well as softness in the market impacting shipments. We continue to focus on investing in technology to meet customer needs, optimizing our inventory levels, and improving our portfolio profitability. We report the financial results of our AMPAC business in our specialty materials segment. Specialty materials sales for the third quarter of 2025 were $38 million, compared to $59 million for the same period in 2024.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Specialty materials operating profit for the third quarter of 2025 was $6 million, compared to $16 million for the third quarter of 2024. The decrease in operating profit was mainly due to lower volume within the quarter. As previously stated, we will see substantial variation in quarterly results for the specialty materials segment on an ongoing basis due to the nature of the business. For the first nine months of 2025, sales for the specialty materials segment were $134 million, compared to $114 million for the period of January 16th to September 30th, 2024. Specialty materials operating profit for the first nine months of 2025 was $40 million, compared to $16 million for the period of January 16th to September 30th, 2024. As previously announced, we expanded our investment in the specialty materials segment through the October 1st, 2025, acquisition of Calca Solutions, LLC.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Calca is the nation's leading producer of ultra-pure hydrazine propellants used in advanced aerospace and defense applications. Since 2024, through our acquisitions of AMPAC and Calca and our investments to expand capacity at both operations, we have committed approximately $1 billion to this resilient, high-technology specialty materials segment. Our company generated solid cash flows throughout the first nine months of 2025, which allowed us to return $155 million to our shareholders through share repurchases of $77 million and dividends of $78 million. We also reduced our net debt by $213 million in the first nine months of 2025, driving our net debt-to-EBITDA ratio down to 0.9 times as of September 30, 2025. This strong cash flow performance enables us to continue to provide value to our shareholders through reinvestment of capital into our businesses for growth and efficiency, acquisitions, share repurchases, and dividends.

[Timothy Fitzgerald, VP and CFO at NewMarket Corporation]

Yesterday, the company's Board of Directors approved raising the quarterly dividend by 9%, up from $2.75 per share on our common stock to $3 per share for the dividend that is payable January 2, 2026. We anticipate continued strength in our petroleum additives and specialty materials segments. We are committed to making decisions that promote long-term value for our shareholders and customers while staying focused on our long-term objectives. We believe that the core principles guiding our business—a long-term perspective, a safety-first culture, customer-focused solutions, technology-driven products, and a world-class supply chain—will continue to benefit all of our stakeholders. Matthew, that concludes our planned comments. We are available for questions via email or by phone, so please feel free to contact me directly. Thank you all again, and we will talk to you next quarter.

Participants

Executives

• Timothy Fitzgerald, VP and CFO