Financial results for the quarter ending March 31 saw an increase in operating income at lubricant blender Valvoline, while the year 2007 saw a solid performance by Cognis’ functional products business unit, which includes businesses that produce synthetic lubricants and specialty chemicals used in lubricant additives, although Cognis as a whole reported a net loss for the year.
Valvoline parent company Ashland said the lube blender reported operating income of $24.1 million for the three months ending March 31 – the second quarter of Ashlands 2008 fiscal year – up 7.6 percent from $22.4 million in the year-earlier period. Valvolines sales and operating revenues for the quarter increased 5 percent over the same period in 2007, to $401 million.
Ashland said strong profit growth from both the Valvoline Instant Oil Change business and Valvoline International drove results for the quarter. Valvolines total lubricant volume increased 1 percent, essentially all from private-label business, which carries a lower margin.
Valvoline continued to perform well and achieved record second-quarter and first-half operating income, despite some pressure on margins, said James J. OBrien, Ashland chairman and chief executive officer.
Covington, Ky.-based Ashland as a whole reported net income of $72 million on revenues of $2.1 billion for the quarter.
Cognis functional products business unit – including its synthetic lubricants, mining technology, AgroSolutions and polymers, coatings and inks businesses – reported sales of 874 million (U.S. $1.4 billion) for the full year 2007, up 3.9 percent from 841 million in 2006.
During the fourth quarter of 2007, Cognis functional products unit posted net sales of 210 million, up 5.5 percent from 199 million in the year-earlier period.
Demand for the companys agricultural solutions and synthetic lubricants was particularly strong, Cognis said. The company stated that its synthetic lubricants business expanded its sales in Europe and Asia. Sales of compounded lubricants in the USA remained stable versus 2006, indicating a performance level better than the overall market, considering that truck build numbers fell below 2006, the company continued.
Dusseldorf, Germany-based Cognis as a whole reported full-year sales in 2007 of 3.4 billion, up 4.3 percent from the previous year.
Cognis overall reported net profit, before exceptional items, of 30 million for 2007, up from 2 million in the previous year. However, after accounting for depreciation of financing fees, revaluation of deferred tax assets and liabilities and other items, Cognis reported a net loss of 120 million for 2007.