Ingevity reports third quarter 2024 financial results
Ingevity (NYSE: NGVT) reported Q3 2024 financial results with net sales of $376.9 million, down 16% year-over-year. The company posted a net loss of $107.2 million and diluted loss per share of $2.95, including restructuring charges of $86.9 million and contract termination fees of $100 million. Adjusted earnings were $40.2 million with diluted adjusted EPS of $1.10. Adjusted EBITDA reached $106.4 million with a 28.2% margin. The company affirmed full-year guidance with sales between $1.40-1.50 billion and adjusted EBITDA of $350-360 million.
Ingevity (NYSE: NGVT) ha riportato i risultati finanziari del terzo trimestre 2024, con vendite nette di 376,9 milioni di dollari, in calo del 16% rispetto all'anno precedente. L'azienda ha registrato una perdita netta di 107,2 milioni di dollari e una perdita diluita per azione di 2,95 dollari, inclusi oneri di ristrutturazione di 86,9 milioni di dollari e penali per cessazione di contratti di 100 milioni di dollari. Gli utili rettificati sono stati di 40,2 milioni di dollari, con un utile rettificato per azione diluita di 1,10 dollari. L'EBITDA rettificato ha raggiunto 106,4 milioni di dollari, con un margine del 28,2%. L'azienda ha confermato le previsioni annuali, con vendite comprese tra 1,40 e 1,50 miliardi di dollari e un EBITDA rettificato di 350-360 milioni di dollari.
Ingevity (NYSE: NGVT) reportó los resultados financieros del tercer trimestre de 2024, con ventas netas de 376.9 millones de dólares, una disminución del 16% en comparación con el año anterior. La empresa registró una pérdida neta de 107.2 millones de dólares y una pérdida diluida por acción de 2.95 dólares, incluidos cargos de reestructuración de 86.9 millones de dólares y tarifas de terminación de contrato de 100 millones de dólares. Las ganancias ajustadas fueron de 40.2 millones de dólares, con una utilidad ajustada por acción diluida de 1.10 dólares. El EBITDA ajustado alcanzó los 106.4 millones de dólares con un margen del 28.2%. La empresa reafirmó su guía para todo el año, con ventas entre 1.40 y 1.50 mil millones de dólares y un EBITDA ajustado de 350-360 millones de dólares.
인게버티 (NYSE: NGVT)는 2024년 3분기 재무 결과를 발표했으며, 순매출은 3억 7690만 달러로 지난해 대비 16% 감소했습니다. 회사는 1억 720만 달러의 순손실을 기록했으며, 주당 희석 손실은 2.95달러로, 구조조정 비용 8천690만 달러와 계약 해지 수수료 1억 달러를 포함합니다. 조정된 순익은 4천200만 달러로 주당 조정 EPS는 1.10달러였습니다. 조정 EBITDA는 1억 640만 달러에 달하며, 마진 비율은 28.2%입니다. 회사는 14억에서 15억 달러 사이의 연간 매출 및 3억 5000만에서 3억 6000만 달러의 조정 EBITDA 예상치를 확인했습니다.
Ingevity (NYSE: NGVT) a publié les résultats financiers du troisième trimestre 2024, avec des ventes nettes de 376,9 millions de dollars, en baisse de 16 % par rapport à l'année précédente. L'entreprise a enregistré une perte nette de 107,2 millions de dollars et une perte diluée par action de 2,95 dollars, y compris des charges de restructuration de 86,9 millions de dollars et des frais de résiliation de contrat de 100 millions de dollars. Les bénéfices ajustés s'élevaient à 40,2 millions de dollars, avec un BPA ajusté dilué de 1,10 dollar. L'EBITDA ajusté a atteint 106,4 millions de dollars avec une marge de 28,2 %. L'entreprise a confirmé ses prévisions annuelles, avec des ventes entre 1,40 et 1,50 milliard de dollars et un EBITDA ajusté de 350 à 360 millions de dollars.
Ingevity (NYSE: NGVT) hat die finanziellen Ergebnisse für das dritte Quartal 2024 veröffentlicht, mit Nettoumsätzen von 376,9 Millionen US-Dollar, was einem Rückgang von 16 % im Vergleich zum Vorjahr entspricht. Das Unternehmen verzeichnete einen Nettoverlust von 107,2 Millionen US-Dollar und einen verwässerten Verlust pro Aktie von 2,95 US-Dollar, einschließlich Restrukturierungskosten von 86,9 Millionen US-Dollar und Vertragsauflösungsgebühren von 100 Millionen US-Dollar. Die bereinigten Einkünfte betrugen 40,2 Millionen US-Dollar, mit einem bereinigten verwässerten EPS von 1,10 US-Dollar. Das bereinigte EBITDA erreichte 106,4 Millionen US-Dollar mit einer Marge von 28,2 %. Das Unternehmen bestätigte die Prognosen für das gesamte Jahr mit einem Umsatz zwischen 1,40 und 1,50 Milliarden US-Dollar und einem bereinigten EBITDA von 350 bis 360 Millionen US-Dollar.
- Performance Materials segment showed 3% sales growth to $151.1M with strong EBITDA margins of 53.3%
- Advanced Polymer Technologies sales increased 14% to $48.8M
- Performance Chemicals segment EBITDA margin improved 160 basis points to 11.2%
- Operating cash flow of $46.5M and free cash flow of $28.5M maintained
- Net loss of $107.2M and diluted loss per share of $2.95
- Performance Chemicals sales declined 31% to $177.0M
- Restructuring charges of $86.9M and contract termination fees of $100M
- Net leverage remains high at 4.0x
- Road Technologies sales down 8% due to unfavorable weather conditions
Insights
The Q3 results reveal significant challenges and strategic shifts at Ingevity. Net sales declined
The Performance Chemicals segment's repositioning is particularly noteworthy, showing a sharp
The segmental performance reveals a mixed picture. Performance Materials remains the standout, with
The
HIGHLIGHTS:
-
Net sales of
$376.9 million 16% compared to prior year, primarily due to repositioning actions in Performance Chemicals -
Net loss of
$107.2 million $2.95 $86.9 million $100.0 million $40.2 million $1.10 -
Adjusted EBITDA of
$106.4 million 28.2% -
Operating cash flow of
$46.5 million $28.5 million -
Affirms full year guidance of sales between
$1.40 billion $1.50 billion $350 million $360 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. All comparisons are made versus the same period in 2023 unless otherwise stated.
Third quarter net sales of
The net loss of
“This quarter's results demonstrate the strong foundation that Ingevity has established,” said Luis Fernandez-Moreno, interim president and CEO. “Performance Materials continues to deliver outstanding results, Advanced Polymer Technologies has shown it can maintain strong margins even in a prolonged industrial slowdown, and Performance Chemicals is beginning to show the benefits of its lower cost structure driven by our repositioning actions. I am excited and energized to step into this role where my focus will be on accelerating the teams’ existing business strategies through improved execution and focus to drive consistent revenue growth and margin improvement.”
Performance Materials
Sales in Performance Materials were
Advanced Polymer Technologies
Sales in Advanced Polymer Technologies (APT) were up
Performance Chemicals
Sales in Performance Chemicals were
Road Technologies product line sales of
Segment EBITDA was
Liquidity/Other
Third quarter operating cash flow was
Full Year 2024 Guidance
“We began to see the positive impact of the Performance Chemicals segment repositioning during the quarter. Our focus over the next several quarters will be on execution to ensure we maximize the benefits of our strategy. We are affirming our guidance of sales between
Additional Information
The company will host a live webcast on Wednesday, October 30, at 10:00 a.m. (Eastern) to discuss third quarter 2024 fiscal results. The webcast can be accessed here or on the investors section of Ingevity’s website. You may also listen to the conference call by dialing 833 470 1428 (inside the
Ingevity: Purify, Protect and Enhance
Ingevity provides products and technologies that purify, protect and enhance the world around us. Through a team of talented and experienced people, we develop, manufacture and bring to market solutions that help customers solve complex problems and make the world more sustainable. We operate in three reporting segments: Performance Materials, which includes activated carbon; Advanced Polymer Technologies, which includes caprolactone polymers; and Performance Chemicals, which includes specialty chemicals and road technologies. Our products are used in a variety of demanding applications, including adhesives, agrochemicals, asphalt paving, certified biodegradable bioplastics, coatings, elastomers, lubricants, pavement markings, oil production and automotive components. Headquartered in
Use of non-GAAP financial measures: This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided within the Appendix to this press release. Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those measures provided. The company does not attempt to provide reconciliations of forward-looking non-GAAP guidance to the comparable GAAP measure because the impact and timing of the factors underlying the guidance assumptions are inherently uncertain and difficult to predict and are unavailable without unreasonable efforts. In addition, Ingevity believes such reconciliations would imply a degree of certainty that could be confusing to investors.
Forward Looking Statements
This press release contains “forward looking statements” within the meaning of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements generally include the words “will,” “plans,” “intends,” “targets,” “expects,” “outlook,” “guidance,” “believes,” “anticipates” or similar expressions. Forward looking statements may include, without limitation, anticipated timing, charges and costs of any current or future repositioning of our Performance Chemicals segment, including the oleo-based product refining transition,
INGEVITY CORPORATION Condensed Consolidated Statements of Operations (Unaudited) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions, except per share data |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net sales |
$ |
376.9 |
|
|
$ |
446.0 |
|
$ |
1,107.6 |
|
|
$ |
1,320.4 |
|
|
Cost of sales |
|
247.0 |
|
|
|
317.0 |
|
|
|
754.8 |
|
|
|
908.0 |
|
Gross profit |
|
129.9 |
|
|
|
129.0 |
|
|
|
352.8 |
|
|
|
412.4 |
|
Selling, general, and administrative expenses |
|
38.7 |
|
|
|
40.0 |
|
|
|
127.3 |
|
|
|
140.3 |
|
Research and technical expenses |
|
6.7 |
|
|
|
7.8 |
|
|
|
20.8 |
|
|
|
24.6 |
|
Restructuring and other (income) charges, net |
|
86.9 |
|
|
|
24.6 |
|
|
|
162.8 |
|
|
|
49.4 |
|
Goodwill impairment charge |
|
— |
|
|
|
— |
|
|
|
349.1 |
|
|
|
— |
|
Acquisition-related costs |
|
(0.1 |
) |
|
|
0.1 |
|
|
|
— |
|
|
|
3.8 |
|
Other (income) expense, net |
|
111.8 |
|
|
|
1.3 |
|
|
|
167.9 |
|
|
|
(13.9 |
) |
Interest expense, net |
|
23.8 |
|
|
|
23.1 |
|
|
|
69.3 |
|
|
|
64.3 |
|
Income (loss) before income taxes |
|
(137.9 |
) |
|
|
32.1 |
|
|
|
(544.4 |
) |
|
|
143.9 |
|
Provision (benefit) for income taxes |
|
(30.7 |
) |
|
|
6.9 |
|
|
|
(97.5 |
) |
|
|
32.5 |
|
Net income (loss) |
$ |
(107.2 |
) |
|
$ |
25.2 |
|
|
$ |
(446.9 |
) |
|
$ |
111.4 |
|
|
|
|
|
|
|
|
|
||||||||
Per share data |
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share |
$ |
(2.95 |
) |
|
$ |
0.70 |
|
|
$ |
(12.31 |
) |
|
$ |
3.05 |
|
Diluted earnings (loss) per share |
|
(2.95 |
) |
|
|
0.69 |
|
|
|
(12.31 |
) |
|
|
3.03 |
|
Weighted average shares outstanding |
|
|
|
|
|
|
|
||||||||
Basic |
|
36.3 |
|
|
|
36.2 |
|
|
|
36.3 |
|
|
|
36.6 |
|
Diluted |
|
36.3 |
|
|
|
36.4 |
|
|
|
36.3 |
|
|
|
36.8 |
|
INGEVITY CORPORATION Segment Operating Results (Unaudited) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net sales |
|
|
|
|
|
|
|
||||||||
Performance Materials |
$ |
151.1 |
|
|
$ |
147.2 |
|
|
$ |
453.4 |
|
|
$ |
433.2 |
|
Road Technologies product line |
|
119.0 |
|
|
|
129.7 |
|
|
|
293.8 |
|
|
|
316.4 |
|
Industrial Specialties product line |
|
58.0 |
|
|
|
126.3 |
|
|
|
215.7 |
|
|
|
409.2 |
|
Performance Chemicals |
$ |
177.0 |
|
|
$ |
256.0 |
|
|
$ |
509.5 |
|
|
$ |
725.6 |
|
Advanced Polymer Technologies |
$ |
48.8 |
|
|
$ |
42.8 |
|
|
$ |
144.7 |
|
|
$ |
161.6 |
|
Total net sales |
$ |
376.9 |
|
|
$ |
446.0 |
|
|
$ |
1,107.6 |
|
|
$ |
1,320.4 |
|
|
|
|
|
|
|
|
|
||||||||
Segment EBITDA (1) |
|
|
|
|
|
|
|
||||||||
Performance Materials |
$ |
80.6 |
|
|
$ |
74.5 |
|
|
$ |
240.8 |
|
|
$ |
208.5 |
|
Performance Chemicals |
|
19.8 |
|
|
|
24.7 |
|
|
|
18.5 |
|
|
|
89.9 |
|
Advanced Polymer Technologies |
|
9.8 |
|
|
|
11.2 |
|
|
|
29.1 |
|
|
|
36.6 |
|
Total segment EBITDA (1) |
$ |
110.2 |
|
|
$ |
110.4 |
|
|
$ |
288.4 |
|
|
$ |
335.0 |
|
Interest expense, net |
|
(23.8 |
) |
|
|
(23.1 |
) |
|
|
(69.3 |
) |
|
|
(64.3 |
) |
(Provision) benefit for income taxes |
|
30.7 |
|
|
|
(6.9 |
) |
|
|
97.5 |
|
|
|
(32.5 |
) |
Depreciation and amortization - Performance Materials |
|
(9.7 |
) |
|
|
(9.5 |
) |
|
|
(29.0 |
) |
|
|
(28.7 |
) |
Depreciation and amortization - Performance Chemicals |
|
(8.6 |
) |
|
|
(13.2 |
) |
|
|
(31.1 |
) |
|
|
(40.0 |
) |
Depreciation and amortization - Advanced Polymer Technologies |
|
(7.9 |
) |
|
|
(7.9 |
) |
|
|
(23.0 |
) |
|
|
(23.4 |
) |
Restructuring and other income (charges), net (2) (3) |
|
(86.9 |
) |
|
|
(24.6 |
) |
|
|
(162.8 |
) |
|
|
(49.4 |
) |
Goodwill impairment charge (2)(4) |
|
— |
|
|
|
— |
|
|
|
(349.1 |
) |
|
|
— |
|
Acquisition and other-related costs (2) (5) |
|
0.1 |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
(4.6 |
) |
Inventory charges (6) |
|
(3.8 |
) |
|
|
— |
|
|
|
(6.3 |
) |
|
|
— |
|
Loss on CTO resales (2) (4) |
|
(0.8 |
) |
|
|
— |
|
|
|
(50.8 |
) |
|
|
— |
|
CTO supply contract termination charges (2) (4) |
|
(100.0 |
) |
|
|
— |
|
|
|
(100.0 |
) |
|
|
— |
|
Gain (loss) on strategic investments (2) (7) |
|
(6.7 |
) |
|
|
0.1 |
|
|
|
(11.4 |
) |
|
|
19.3 |
|
Net income (loss) |
$ |
(107.2 |
) |
|
$ |
25.2 |
|
|
$ |
(446.9 |
) |
|
$ |
111.4 |
|
_______________ |
|
(1) |
Segment EBITDA is the primary measure used by our chief operating decision maker ("CODM") to evaluate the performance of and allocate resources among our operating segments. Segment EBITDA is defined as segment net sales less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses, research and technical expenses, other (income) expense, net, excluding depreciation and amortization). We have excluded the following items from segment EBITDA: interest expense associated with corporate debt facilities, interest income, income taxes, depreciation, amortization, restructuring and other income (charges), net, inventory lower of cost or market charges associated with restructuring actions, goodwill impairment charge, acquisition and other-related income (costs), litigation verdict charges, gain (loss) on strategic investments, loss on CTO resales, CTO supply contract termination charges, pension and postretirement settlement and curtailment income (charges), net. |
(2) |
For more information on these charges, refer to the Reconciliation of Adjusted Earnings table on page 7. |
(3) |
The table below provides an allocation of these charges between our three reportable segments to provide investors, potential investors, securities analysts and others with the information, should they choose, to apply such (income) charges to each respective reportable segment for which the charges relate. |
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Performance Materials |
$ |
0.6 |
|
$ |
1.3 |
|
$ |
0.7 |
|
$ |
7.5 |
|||||
Performance Chemicals |
|
86.1 |
|
|
|
22.9 |
|
|
|
162.0 |
|
|
|
39.6 |
|
|
Advanced Polymer Technologies |
|
0.2 |
|
|
|
0.4 |
|
|
|
0.1 |
|
|
|
2.3 |
|
|
Restructuring and other (income) charges, net |
$ |
86.9 |
|
|
$ |
24.6 |
|
|
$ |
162.8 |
|
|
$ |
49.4 |
|
|
(4) |
For the three and nine months ended September 30, 2024, charges relate to the Performance Chemicals reportable segment. |
(5) |
For the three and nine months ended September 30, 2024 and 2023, charges relate to the Performance Chemicals reportable segment. |
(6) |
For the three and nine months ended September 30, 2024, inventory charges represent lower of cost or market charges associated with the Performance Chemicals’ repositioning. These charges were not allocated in the measurement of our Performance Chemicals reportable segment profitability used by our CODM. Amounts are included in Cost of sales on the condensed consolidated statement of operations. |
(7) |
The table below provides an allocation of these charges between our three reportable segments to provide investors, potential investors, securities analysts and others with the information, should they choose, to apply such (income) charges to each respective reportable segment for which the charges relate. |
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Performance Materials |
$ |
— |
|
|
$ |
(0.1 |
) |
|
$ |
(0.1 |
) |
|
$ |
(19.3 |
) |
|
Performance Chemicals |
|
4.5 |
|
|
— |
|
|
|
9.3 |
|
|
|
— |
|
||
Advanced Polymer Technologies |
|
2.2 |
|
|
|
— |
|
|
|
2.2 |
|
|
|
— |
|
|
(Gain) loss on strategic investments |
$ |
6.7 |
|
|
$ |
(0.1 |
) |
|
$ |
11.4 |
|
|
$ |
(19.3 |
) |
|
INGEVITY CORPORATION Condensed Consolidated Balance Sheets (Unaudited) |
|||||
In millions |
September 30, 2024 |
|
December 31, 2023 |
||
Assets |
|
|
|
||
Cash and cash equivalents |
$ |
135.5 |
|
$ |
95.9 |
Accounts receivable, net |
|
189.9 |
|
|
182.0 |
Inventories, net |
|
261.0 |
|
|
308.8 |
Prepaid and other current assets |
|
50.4 |
|
|
71.9 |
Current assets |
|
636.8 |
|
|
658.6 |
Property, plant, and equipment, net |
|
671.3 |
|
|
762.2 |
Goodwill |
|
186.9 |
|
|
527.5 |
Other intangibles, net |
|
298.6 |
|
|
336.1 |
Restricted investment |
|
81.1 |
|
|
79.1 |
Strategic investments |
|
87.3 |
|
|
99.2 |
Other assets |
|
249.6 |
|
|
160.6 |
Total Assets |
$ |
2,211.6 |
|
$ |
2,623.3 |
|
|
|
|
||
Liabilities |
|
|
|
||
Accounts payable |
$ |
96.5 |
|
$ |
158.4 |
Accrued expenses |
|
116.8 |
|
|
72.3 |
Notes payable and current maturities of long-term debt |
|
100.7 |
|
|
84.4 |
Other current liabilities |
|
46.8 |
|
|
47.8 |
Current liabilities |
|
360.8 |
|
|
362.9 |
Long-term debt including finance lease obligations |
|
1,397.6 |
|
|
1,382.8 |
Deferred income taxes |
|
65.7 |
|
|
70.9 |
Other liabilities |
|
173.0 |
|
|
175.3 |
Total Liabilities |
|
1,997.1 |
|
|
1,991.9 |
Equity |
|
214.5 |
|
|
631.4 |
Total Liabilities and Equity |
$ |
2,211.6 |
|
$ |
2,623.3 |
INGEVITY CORPORATION Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
(107.2 |
) |
|
$ |
25.2 |
|
|
$ |
(446.9 |
) |
|
$ |
111.4 |
|
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
|
26.2 |
|
|
|
30.6 |
|
|
|
83.1 |
|
|
|
92.1 |
|
Restructuring and other (income) charges, net |
|
86.9 |
|
|
|
24.6 |
|
|
|
162.8 |
|
|
|
49.4 |
|
Loss on CTO resales |
|
0.8 |
|
|
|
— |
|
|
|
50.8 |
|
|
|
— |
|
(Gain) loss on strategic investment |
|
6.7 |
|
|
|
(0.1 |
) |
|
|
11.4 |
|
|
|
(19.3 |
) |
Goodwill impairment charge |
|
— |
|
|
|
— |
|
|
|
349.1 |
|
|
|
— |
|
CTO supply contract termination charges |
|
100.0 |
|
|
|
— |
|
|
|
100.0 |
|
|
|
— |
|
Other non-cash items |
|
(24.7 |
) |
|
|
39.3 |
|
|
|
(88.5 |
) |
|
|
115.9 |
|
Changes in operating assets and liabilities, net of effect of acquisitions: |
|
|
|
|
|
|
|
||||||||
Restructuring and other cash outflow, net |
|
(21.0 |
) |
|
|
(21.9 |
) |
|
|
(43.9 |
) |
|
|
(46.7 |
) |
CTO resales cash inflow (outflow), net |
|
0.3 |
|
|
|
— |
|
|
|
(45.0 |
) |
|
|
— |
|
CTO supply contract termination cash outflow |
|
(50.0 |
) |
|
|
— |
|
|
|
(50.0 |
) |
|
|
— |
|
Changes in other operating assets and liabilities, net |
|
28.5 |
|
|
|
7.5 |
|
|
|
(18.8 |
) |
|
|
(143.9 |
) |
Net cash provided by (used in) operating activities |
$ |
46.5 |
|
|
$ |
105.2 |
|
|
$ |
64.1 |
|
|
$ |
158.9 |
|
Cash provided by (used in) investing activities: |
|
|
|
|
|
|
|
||||||||
Capital expenditures |
$ |
(18.0 |
) |
|
$ |
(33.5 |
) |
|
$ |
(52.7 |
) |
|
$ |
(80.6 |
) |
Proceeds from sale of strategic investment |
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
31.5 |
|
Purchase of strategic investment |
|
— |
|
|
|
(2.4 |
) |
|
|
— |
|
|
|
(2.4 |
) |
Other investing activities, net |
|
0.6 |
|
|
|
3.5 |
|
|
|
1.2 |
|
|
|
(1.1 |
) |
Net cash provided by (used in) investing activities |
$ |
(17.4 |
) |
|
$ |
(32.3 |
) |
|
$ |
(51.5 |
) |
|
$ |
(52.6 |
) |
Cash provided by (used in) financing activities: |
|
|
|
|
|
|
|
||||||||
Proceeds from revolving credit facility and other borrowings |
$ |
38.2 |
|
|
$ |
41.7 |
|
|
$ |
150.5 |
|
|
$ |
239.5 |
|
Payments on revolving credit facility and other borrowings |
|
(44.1 |
) |
|
|
(95.3 |
) |
|
|
(119.3 |
) |
|
|
(240.1 |
) |
Finance lease obligations, net |
|
(0.3 |
) |
|
|
(0.1 |
) |
|
|
(0.9 |
) |
|
|
(0.6 |
) |
Tax payments related to withholdings on vested equity awards |
|
(0.1 |
) |
|
|
(0.3 |
) |
|
|
(2.9 |
) |
|
|
(4.8 |
) |
Proceeds and withholdings from share-based compensation plans, net |
|
— |
|
|
|
0.7 |
|
|
|
— |
|
|
|
4.7 |
|
Repurchases of common stock under publicly-announced plan |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(92.1 |
) |
Net cash provided by (used in) financing activities |
$ |
(6.3 |
) |
|
$ |
(53.3 |
) |
|
$ |
27.4 |
|
|
$ |
(93.4 |
) |
Increase (decrease) in cash, cash equivalents, and restricted cash |
|
22.8 |
|
|
|
19.6 |
|
|
|
40.0 |
|
|
|
12.9 |
|
Effect of exchange rate changes on cash |
|
5.4 |
|
|
|
(2.3 |
) |
|
|
1.6 |
|
|
|
(3.0 |
) |
Change in cash, cash equivalents, and restricted cash(1) |
|
28.2 |
|
|
|
17.3 |
|
|
|
41.6 |
|
|
|
9.9 |
|
Cash, cash equivalents, and restricted cash at beginning of period |
|
125.3 |
|
|
|
76.9 |
|
|
|
111.9 |
|
|
|
84.3 |
|
Cash, cash equivalents, and restricted cash at end of period (1) |
$ |
153.5 |
|
|
$ |
94.2 |
|
|
$ |
153.5 |
|
|
$ |
94.2 |
|
|
|
|
|
|
|
|
|
||||||||
(1) Includes restricted cash of |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Supplemental cash flow information: |
|
|
|
|
|
|
|
||||||||
Cash paid for interest, net of capitalized interest |
$ |
18.7 |
|
|
$ |
17.9 |
|
|
$ |
61.0 |
|
|
$ |
57.9 |
|
Cash paid for income taxes, net of refunds |
|
1.8 |
|
|
|
4.3 |
|
|
|
24.0 |
|
|
|
27.9 |
|
Purchases of property, plant, and equipment in accounts payable |
|
0.4 |
|
|
|
0.8 |
|
|
|
2.2 |
|
|
|
6.1 |
|
Leased assets obtained in exchange for new finance lease liabilities |
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
0.2 |
|
Leased assets obtained in exchange for new operating lease liabilities |
|
3.6 |
|
|
|
7.2 |
|
|
|
5.5 |
|
|
|
26.0 |
|
Ingevity Corporation
Non-GAAP Financial Measures
Ingevity has presented certain financial measures, defined below, which have not been prepared in accordance with
We believe these non-GAAP financial measures provide management as well as investors, potential investors, securities analysts, and others with useful information to evaluate the performance of the business, because such measures, when viewed together with our financial results computed in accordance with GAAP, provide a more complete understanding of the factors and trends affecting our historical financial performance, liquidity measures, and projected future results.
Ingevity uses the following non-GAAP measures:
Adjusted earnings (loss) is defined as net income (loss) plus restructuring and other (income) charges, net, goodwill impairment charge, acquisition and other-related (income) costs, pension and postretirement settlement and curtailment (income) charges, loss on CTO resales, CTO supply contract termination charges, (gain) loss on strategic investments, debt refinancing fees, litigation verdict charges, and the income tax expense (benefit) on those items, less the provision (benefit) from certain discrete tax items.
Diluted adjusted earnings (loss) per share is defined as diluted earnings (loss) per common share plus restructuring and other (income) charges, net, per share, goodwill impairment charge per share, acquisition and other-related (income) costs per share, pension and postretirement settlement and curtailment (income) charges per share, loss on CTO resales per share, CTO supply contract termination charges per share, (gain) loss on strategic investments per share, debt refinancing fees per share, litigation verdict charge per share, and the income tax expense (benefit) per share on those items, less the provision (benefit) from certain discrete tax items per share.
Adjusted EBITDA is defined as net income (loss) plus interest expense, net, provision (benefit) for income taxes, depreciation, amortization, restructuring and other (income) charges, net, goodwill impairment charge, acquisition and other-related (income) costs, litigation verdict charges, (gain) loss on strategic investments, loss on CTO resales, CTO supply contract termination charges, and pension and postretirement settlement and curtailment (income) charges, net.
Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by Net sales.
Free Cash Flow is defined as the sum of net cash provided by (used in) the following items: operating activities less capital expenditures.
Net Debt is defined as the sum of notes payable, short-term debt, current maturities of long-term debt and long-term debt including finance lease obligations less the sum of cash and cash equivalents, restricted cash associated with our new market tax credit financing arrangement, and restricted investment associated with certain finance lease obligations, excluding the allowance for credit losses on held-to-maturity debt securities held within the restricted investment.
Net Debt Ratio is defined as Net Debt divided by the last twelve months Adjusted EBITDA, inclusive of acquisition-related pro forma adjustments.
Ingevity's management also uses the above financial measures as the primary measures of profitability and liquidity of the business. In addition, Ingevity believes Adjusted EBITDA and Adjusted EBITDA Margin are useful measures because they exclude the effects of financing and investment activities as well as non-operating activities.
GAAP Reconciliation of 2024 Adjusted EBITDA Guidance
A reconciliation of net income to adjusted EBITDA as projected for 2024 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 (income) costs; litigation verdict charges; additional pension and postretirement settlement and curtailment (income) charges; and revisions due to legislative tax rate changes. 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 the comparability of periods, and which are not known at this time, may exist and impact adjusted EBITDA.
INGEVITY CORPORATION
Reconciliation of Non-GAAP Financial Measures
Reconciliation of Net Income (Loss) (GAAP) to Adjusted Earnings (Loss) (Non-GAAP) and Reconciliation of Diluted Earnings (Loss) per Common Share (GAAP) to Diluted Adjusted Earnings per Share (Non-GAAP) |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions, except per share data (unaudited) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Net income (loss) (GAAP) |
$ |
(107.2 |
) |
|
$ |
25.2 |
|
|
$ |
(446.9 |
) |
|
$ |
111.4 |
|
|
Restructuring and other (income) charges, net (1) |
|
86.9 |
|
|
|
24.6 |
|
|
|
162.8 |
|
|
|
49.4 |
|
|
Goodwill impairment charge (2) |
|
— |
|
|
|
— |
|
|
|
349.1 |
|
|
|
— |
|
|
Acquisition and other-related costs (3) |
|
(0.1 |
) |
|
|
0.1 |
|
|
|
— |
|
|
|
4.6 |
|
|
Loss on CTO resales (4) |
|
0.8 |
|
|
|
— |
|
|
|
50.8 |
|
|
|
— |
|
|
CTO supply contract termination charges (5) |
|
100.0 |
|
|
|
— |
|
|
|
100.0 |
|
|
|
— |
|
|
(Gain) loss on strategic investments (6) |
|
6.7 |
|
|
|
(0.1 |
) |
|
|
11.4 |
|
|
|
(19.3 |
) |
|
Tax effect on items above (7) |
|
(43.3 |
) |
|
|
(5.8 |
) |
|
|
(158.0 |
) |
|
|
(8.1 |
) |
|
Certain discrete tax provision (benefit) (8) |
|
(3.6 |
) |
|
|
0.2 |
|
|
|
24.4 |
|
|
|
(1.1 |
) |
|
Adjusted earnings (loss) (Non-GAAP) |
$ |
40.2 |
|
|
$ |
44.2 |
|
|
$ |
93.6 |
|
|
$ |
136.9 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Diluted earnings (loss) per common share (GAAP) |
$ |
(2.95 |
) |
|
$ |
0.69 |
|
|
$ |
(12.31 |
) |
|
$ |
3.03 |
|
|
Restructuring and other (income) charges, net |
|
2.39 |
|
|
|
0.67 |
|
|
|
4.48 |
|
|
|
1.34 |
|
|
Goodwill impairment charge |
|
— |
|
|
|
— |
|
|
|
9.62 |
|
|
|
— |
|
|
Acquisition and other-related costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.13 |
|
|
Loss on CTO resales |
|
0.02 |
|
|
|
— |
|
|
|
1.40 |
|
|
|
— |
|
|
CTO supply contract termination charges |
|
2.75 |
|
|
|
— |
|
|
|
2.75 |
|
|
|
— |
|
|
(Gain) loss on strategic investments |
|
0.18 |
|
|
|
— |
|
|
|
0.31 |
|
|
|
(0.52 |
) |
|
Tax effect on items above |
|
(1.19 |
) |
|
|
(0.16 |
) |
|
|
(4.36 |
) |
|
|
(0.23 |
) |
|
Certain discrete tax provision (benefit) |
|
(0.10 |
) |
|
|
0.01 |
|
|
|
0.67 |
|
|
|
(0.03 |
) |
|
Diluted adjusted earnings (loss) per share (Non-GAAP) |
$ |
1.10 |
|
|
$ |
1.21 |
|
|
$ |
2.56 |
|
|
$ |
3.72 |
|
|
Weighted average common shares outstanding - Diluted (9) |
|
36.5 |
|
|
|
36.4 |
|
|
|
36.5 |
|
|
|
36.8 |
|
|
_______________ |
|
(1) |
We regularly perform strategic reviews and assess the return on our operations, which sometimes results in a plan to restructure the business. These costs are excluded from our reportable segment results; details of which are included in the table below. For the details of these costs between our reportable segments, see Segment Operating Results on page 2. |
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Work force reductions and other |
$ |
— |
|
|
$ |
1.5 |
|
|
$ |
— |
|
|
$ |
11.6 |
||
Performance Chemicals' repositioning |
|
85.6 |
|
|
— |
|
|
157.9 |
|
|
— |
|
||||
Restructuring charges (1) |
$ |
85.6 |
|
|
$ |
1.5 |
|
|
$ |
157.9 |
|
|
$ |
11.6 |
|
|
Alternative feedstock transition |
|
— |
|
|
|
11.8 |
|
|
|
— |
|
|
|
18.4 |
|
|
|
|
1.3 |
|
|
|
9.8 |
|
|
|
4.9 |
|
|
|
12.7 |
|
|
Business transformation costs |
|
— |
|
|
|
1.5 |
|
|
|
— |
|
|
|
6.7 |
|
|
Other (income) charges, net (1) |
$ |
1.3 |
|
|
$ |
23.1 |
|
|
$ |
4.9 |
|
|
$ |
37.8 |
|
|
Restructuring and other (income) charges, net (2) |
$ |
86.9 |
|
|
$ |
24.6 |
|
|
$ |
162.8 |
|
|
$ |
49.4 |
||
| _______________ | |
(1) |
Amounts are recorded within Restructuring and other (income) charges, net on the condensed consolidated statement of operations. |
(2) |
For information on our Workforce reductions and other, Performance Chemicals' repositioning, Alternative feedstock transition, |
(2) |
During the second quarter of 2024, the company concluded that the carrying amount of the Performance Chemicals’ reporting unit exceeded its fair value, resulting in a non-cash goodwill impairment charge. |
(3) |
Charges represent (gains) losses incurred to complete and integrate acquisitions and other strategic investments. Charges may include the expensing of the inventory fair value step-up resulting from the application of purchase accounting for acquisitions and certain legal and professional fees associated with the completion of acquisitions and strategic investments. For the details of these costs between our reportable segments, see Segment Operating Results on page 2. |
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||||
In millions |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Legal and professional service fees |
$ |
(0.1 |
) |
|
$ |
0.1 |
|
$ |
— |
|
$ |
3.8 |
||||
Acquisition-related (income) costs |
$ |
(0.1 |
) |
|
$ |
0.1 |
|
|
$ |
— |
|
|
$ |
3.8 |
|
|
Inventory fair value step-up amortization (1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.8 |
|
|
Acquisition and other-related (income) charges |
$ |
(0.1 |
) |
|
$ |
0.1 |
|
|
$ |
— |
|
|
$ |
4.6 |
||
| _______________ | |
(1) |
Included in Cost of sales on the condensed consolidated statement of operations. |
(4) |
Due to the DeRidder Plant closure and the corresponding reduced CTO refining capacity, we were obligated, under an existing CTO supply contract, to purchase CTO through 2025 at amounts in excess of required CTO volumes. As of July 1, 2024, we have terminated the CTO supply contract that resulted in these excess CTO volumes. As a result of the termination of this contract the purchases under the CTO supply contract ended, effective June 30, 2024. Therefore, we are no longer required to purchase this excess CTO volume through 2025, and as such, we expect to end our CTO resale activity by the end of 2024. Updates will be provided in subsequent filings of the Company's Form 10-Q in 2024. |
(5) |
As consideration for the termination of the CTO supply contract, we made a cash payment in the amount of |
(6) |
We exclude gains and losses from strategic investments from our segment results, as well as our non-GAAP financial measures, because we do not consider such gains or losses to be directly associated with the operational performance of the segment. We believe that the inclusion of such gains or losses, would impair the factors and trends affecting the historical financial performance of our reportable segments. We continue to include undistributed earnings or loss, distributions, amortization or accretion of basis differences, and other-than-temporary impairments for equity method investments that we believe are directly attributable to the operational performance of such investments, in our reportable segment results. |
(7) |
Income tax impact of non-GAAP adjustments is the summation of the calculated income tax charge related to each pre-tax non-GAAP adjustment. The non-GAAP adjustments relate primarily to adjustments in |
(8) |
Represents certain discrete tax items such as excess tax benefits on stock compensation and impacts of legislative tax rate changes. |
(9) |
The average number of shares outstanding used in the three and nine months ended September 30, 2024 diluted adjusted earnings (loss) per share computation (Non-GAAP) includes 0.2 million diluted shares. This number of shares differs from the average number of shares outstanding used in diluted earnings (loss) per share computations (GAAP) as we had a net loss on a GAAP basis. |
Reconciliation of Net Income (Loss) (GAAP) to Adjusted EBITDA (Non-GAAP) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions, except percentages (unaudited) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net income (loss) (GAAP) |
$ |
(107.2 |
) |
|
$ |
25.2 |
|
|
$ |
(446.9 |
) |
|
$ |
111.4 |
|
Provision (benefit) for income taxes |
|
(30.7 |
) |
|
|
6.9 |
|
|
|
(97.5 |
) |
|
|
32.5 |
|
Interest expense, net |
|
23.8 |
|
|
|
23.1 |
|
|
|
69.3 |
|
|
|
64.3 |
|
Depreciation and amortization |
|
26.2 |
|
|
|
30.6 |
|
|
|
83.1 |
|
|
|
92.1 |
|
Restructuring and other (income) charges, net (1) |
|
86.9 |
|
|
|
24.6 |
|
|
|
162.8 |
|
|
|
49.4 |
|
Goodwill impairment charge (1) |
|
— |
|
|
|
— |
|
|
|
349.1 |
|
|
|
— |
|
Acquisition and other-related (income) costs (1) |
|
(0.1 |
) |
|
|
0.1 |
|
|
|
— |
|
|
|
4.6 |
|
Loss on CTO resales (1) |
|
0.8 |
|
|
|
— |
|
|
|
50.8 |
|
|
|
— |
|
CTO supply contract termination charges (1) |
|
100.0 |
|
|
|
— |
|
|
|
100.0 |
|
|
|
— |
|
(Gain) loss on strategic investments (1) |
|
6.7 |
|
|
|
(0.1 |
) |
|
|
11.4 |
|
|
|
(19.3 |
) |
Adjusted EBITDA (Non-GAAP) |
$ |
106.4 |
|
|
$ |
110.4 |
|
|
$ |
282.1 |
|
|
$ |
335.0 |
|
|
|
|
|
|
|
|
|
||||||||
Net sales |
$ |
376.9 |
|
|
$ |
446.0 |
|
|
$ |
1,107.6 |
|
|
$ |
1,320.4 |
|
Net income (loss) margin |
|
(28.4 |
)% |
|
|
5.7 |
% |
|
|
(40.3 |
)% |
|
|
8.4 |
% |
Adjusted EBITDA margin |
|
28.2 |
% |
|
|
24.8 |
% |
|
|
25.5 |
% |
|
|
25.4 |
% |
| _______________ | |
(1) |
For more information on these charges, refer to the Reconciliation of Adjusted Earnings table on page 7. |
Calculation of Free Cash Flow (Non-GAAP) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
In millions (unaudited) |
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net cash provided by (used in) operating activities |
$ |
46.5 |
|
$ |
105.2 |
|
$ |
64.1 |
|
$ |
158.9 |
||||
Less: Capital expenditures |
|
18.0 |
|
|
|
33.5 |
|
|
|
52.7 |
|
|
|
80.6 |
|
Free Cash Flow (Non-GAAP) |
$ |
28.5 |
|
|
$ |
71.7 |
|
|
$ |
11.4 |
|
|
$ |
78.3 |
|
Calculation of Net Debt Ratio (Non-GAAP) |
|||
In millions, except ratios (unaudited) |
September 30, 2024 |
||
Notes payable and current maturities of long-term debt |
$ |
100.7 |
|
Long-term debt including finance lease obligations |
|
1,397.6 |
|
Debt issuance costs |
|
4.5 |
|
Total Debt |
|
1,502.8 |
|
Less: |
|
||
Cash and cash equivalents (1) |
|
135.7 |
|
Restricted investment (2) |
|
81.3 |
|
Net Debt |
$ |
1,285.8 |
|
|
|
||
Net Debt Ratio (Non GAAP) |
|
||
Adjusted EBITDA |
|
||
Twelve months ended December 31, 2023 |
$ |
377.1 |
|
Nine months ended September 30, 2023 (3) |
|
(335.0 |
) |
Nine months ended September 30, 2024 (3) |
|
282.1 |
|
Adjusted EBITDA - last twelve months (LTM) as of September 30, 2024 |
$ |
324.2 |
|
|
|
||
Net debt ratio (Non GAAP) |
|
4.0x |
|
| _______________ | |
(1) |
Includes |
(2) |
Our restricted investment is a trust managed in order to secure repayment of the finance lease obligation associated with Performance Materials' |
(3) |
Refer to the Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP) schedule on page 9 for the reconciliation to the most comparable GAAP financial measure. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241029418496/en/
Caroline Monahan
843-740-2068
media@ingevity.com
Investors:
John E. Nypaver, Jr.
843-740-2002
investors@ingevity.com
Source: Ingevity Corporation
FAQ
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