NewMarkets Afton Chemical reported lower operating profit in the fourth quarter but stronger full-year results, while Valvoline posted increases in sales and operating income for its fiscal quarter ending Dec. 31.
Afton Chemical, the petroleum additives segment of NewMarket Corp., reported operating profit of $73.6 million for the fourth quarter ending Dec. 31, down 7 percent from $79.5 million in the year-earlier period. The company attributed the decrease to changes in selling prices and foreign currency rates, which was partially offset by lower raw material costs.
For the full year, operating profit reached $359.2 million, up almost 16 percent compared to 2018, driven by improved selling prices and lower raw material costs.
Sales for the segment in the fourth quarter were $531.8 million, down just 1 percent. For the year, sales were $2.2 billion, down from $2.3 billion in the prioryear.
Richmond, Virginia-based NewMarket reported net income of $50.1 million, or $4.48 per share, for the fourth quarter, down 20 percent from $62.8 million, or $5.58 per share. For 2019, the company posted net income of $254.3 million, or $22.73 per share, up 8 percent from 2018, when it reported net income of $234.7 million, or $20.34 per share.
Valvolines three operating segments - Core North America, quick lubes and international - posted a combined operating income of $104 million, up almost 20 percent from the same period last year. The quarter ending Dec. 31 is the first quarter of the companys fiscal year.
The Lexington, Kentucky-based companys three segments combined for $607 million in sales, up 9 percent from $557 million. The Core North America segment accounted for the largest portion of those sales with $248 million, or approximately 40.8 percent of sales, followed by quick lubes with $218 million - 35.9 percent - and international at $141 million, or the remaining 23.2 percent.
North American lubricant sales reached 21.4 million gallons for the quarter, down 1.4 percent from 21.7 million gallons, attributed to strong performance in the retail channel offset by weaker installer channel volume, according to the company.
Quick lube lubricant sales hit 7.3 million gallons, up 12.3 percent from 6.5 million gallons. The company also had a net increase of 22 franchised quick lube locations during the quarter.
International lubricant sales totaled 14.7 million gallons, up 6.5 percent from 13.8 million gallons. Valvoline primarily attributed the growth to Europe, the Middle East and Africa, along with strong performance in key Asia-Pacific markets.
"We are pleased with our start to fiscal 2020," Valvoline CEO Sam Mitchell said in the companys earnings news release. "Core North America had a strong quarter, driven by substantially higher branded volume in the retail channel and benefits from the operating expense reduction program announced last year. Quick Lubes continued its solid top line growth of over 15 percent for the quarter, while profitability was only up modestly to prior year due to increases in operating expenses which are expected to moderate. International returned to profitable volume growth in the quarter."