NewMarket Q1 Earnings Call Highlights

Key Points

• Net income fell to $118 million ($12.62/share) in Q1 2026, with petroleum additives sales and operating profit down as shipments declined ~7% and the company reduced low‑margin business, though management said operating profit margins remained strong and shipments improved late in the quarter.
• Specialty materials sales rose to $58 million largely from the Oct. 1, 2025 Calca acquisition, but operating profit dropped to $12 million from $23 million due to an unfavorable quarterly shipment mix and inherent segment volatility.
• Returned $154 million to shareholders (‑$126M buybacks, $28M dividends) with a net debt-to-EBITDA of 1.2x; NewMarket also implemented price adjustments and rebalanced global production to offset rising input and logistics costs amid the Middle East conflict while prioritizing efficiency and technology investments.

NewMarket NYSE: NEU reported first-quarter 2026 net income of $118 million, or $12.62 per share, down from $126 million, or $13.26 per share, in the first quarter of 2025, according to comments on the company’s earnings call led by CFO Tim Fitzgerald.

First-quarter results and segment performance

Fitzgerald said petroleum additives sales were $610 million for the first quarter of 2026, compared to $646 million in the prior-year period. Petroleum additives operating profit totaled $135 million, down from $142 million a year earlier.

He attributed the decline in petroleum additives operating profit “mainly due to the decline in shipments of 7%,” citing both “softening in the market” and “our strategic decision to reduce low-margin business.” Fitzgerald added that the company was “encouraged by the increase in shipments we observed in the latter part of the first quarter of 2026,” and said that despite the lower shipment volume, “our operating profit margin remained strong.”

In specialty materials—which includes the company’s AMPAC business as well as its newly acquired Calca Solutions business—NewMarket posted sales of $58 million, up from $54 million in the first quarter of 2025. Fitzgerald said the increase was “mainly due to the inclusion of the Calca business, which was acquired on October 1st, 2025,” partially offset by “a shift in shipment mix at AMPAC versus the first quarter of last year.”

Specialty materials operating profit fell to $12 million from $23 million in the prior-year quarter. Fitzgerald said the decline was “mainly due to the change in quarterly shipment mix at AMPAC compared to last year,” and he reiterated that the segment can produce “substantial variation in quarterly results…due to the nature of the business.”

Market conditions and operating actions

Fitzgerald said NewMarket was operating in a rapidly changing environment due to the conflict in the Middle East, describing it as a key factor affecting the operating backdrop during the quarter. He said the company implemented “price adjustments to account for the escalating cost of raw materials, utilities, and logistics,” and also “rebalanced our global production to make sure we are meeting customer demands in a dynamically evolving market.”

Despite the challenges, Fitzgerald said the company remains focused on efficiency and cost discipline. He outlined priorities that include “investing in technology and our supply network to meet customer demands, enhancing our operational efficiency and improving our portfolio profitability.”

Cash flow, shareholder returns, and leverage

NewMarket returned $154 million to shareholders during the first quarter, Fitzgerald said, including $126 million in share repurchases and $28 million in dividends. He also reported that as of March 31, 2026, the company’s net debt-to-EBITDA ratio was 1.2 times.

Outlook and priorities

Looking ahead, Fitzgerald said the company is “committed to making decisions that promote long-term value for our shareholders and customers while staying focused on our long-term objectives.” He pointed to several principles he said guide the business, including “a long-term perspective, a safety-first culture, customer-focused solutions, technology-driven products, and a world-class supply chain.”

The call did not include a live question-and-answer session. Fitzgerald said he would be available for follow-up questions “via email or by phone.”

About NewMarket NYSE: NEU

NewMarket Corporation 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.

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