Valvolines parent company reported Monday that operating profit for the automotive consumer products supplier rose 33 percent to $20 million for the quarter ended Dec. 31, mostly due to growing sales of premium products.
Ashland Inc., which is based in Covington, Ky., said Valvoline had a record performance for the period, the first quarter of its fiscal year, despite the fact that lubricant sales volumes dipped 1.4 percent to 43.7 million gallons. Sales and operating revenue increased 3.2 percent year-to-year to $290 million as the company continued selling more higher-margin products, such as MaxLife motor oil for higher-mileage vehicles.
Sales of premium products, as a percent of branded volume sales in the United States, swelled from 16.9 percent to 19.3 percent. Management did not disclose the exact volume of premium product sales but said they increased 20 percent during the first quarter.
The companys quick-lube business, Valvoline Instant Oil Change, had its best quarter ever, with operating income rising 49 percent from the year-ago period. The chains improvement was driven by a 7 percent increase in premium lubricant oil changes and by a 9 percent increase in revenues from transmission, cooling, fuel and air quality system services.
Ashland officials said Valvoline, like its sister subsidiaries, also benefited from cost-cutting measures.