Q3 2020 NewMarket Corp Earnings Call

Please standby we are about speaking.

Good day, ladies and gentlemen, and welcome to your New Market Corporation Conference call and webcast to review third quarter 2020 financial result.

All lines have been placed in a listen only mode.

This time it is my pleasure to turn the floor over to your house.

I am sorry.

The floor is yours.

Thank you Christie and thanks to everyone for joining us. This afternoon as a reminder, some of the statements made during this conference call may be forward looking.

Relevant factors that could cause actual results to differ materially from those forward looking statements are contained in our earnings release.

And in or our SEC filings, including our most recent form 10-K, and our first quarter 10-Q.

During this call. We May also discuss the non-GAAP financial measure included in our earnings release there.

Our news release, which can be found on our website includes a reconciliation of the non-GAAP financial measure to the comparable GAAP financial measure.

We filed our 10-Q. This morning it contains significantly more details on the operations and performance.

Performance of our company.

Please take time to review it.

I will be referring to the data that was included in last nights release.

Net income was $96 million or $8.70, a share compared to net income of $68 million or $6 and six a share cents a share for the third quarter of last year.

Increased performance includes a one time 16.5 million dollar gain on.

The sale of a non operating real estate assets.

This asset was part of our long term real estate strategy that we've been executing on over the past few decades. This specific parcel project was kicked off late last year and closed in the third quarter.

Sales for the petroleum additives segment for the third quarter of 2020 were $510 million compared to sales in the third quarter of 2019 of $551 million. The decrease was due primarily to lower shipments in selling prices [noise].

Trillium additives operating profit for the third quarter of 2020 was $102 million compared to $95 million for the same period last year. The increase was due to lower raw material costs, selling general and administrative costs research and development costs, partially offset by changes in selling prices higher cost.

Training costs and lower shipments.

Shipments decreased 3.2% between the periods, mainly driven by decreases in fuel additive shipments.

Our third quarter 2020 operating results reflected continued improvement in some of the key drivers that affect the performance of our business consistent with what we see.

[noise] began to see near the end of the second quarter.

With gasoline consumption rebounded quickly miles driven continue to show improvement industrial production beginning to rebound specifically related to automotive build plants reopening and producing vehicles demand for both our lubricant and fuel additives having.

Have increased steadily throughout the quarter.

Well, our second quarter results were significantly impacted by the economic disruption due to the COVID-19 pandemic and related government restrictions. These improvements in the third quarter of 2020 helped to drive an increase in shipments compared to the second quarter of over 25%.

The effective tax rate for the third quarter of 2020 was 18.6% down from the rate of 22.5% for the same period last year.

During the quarter, we funded capital expenditures of $20 million repaid debt of $82 million and paid dividends of $21 million as we continue to operate with very low leverage net debt to EBITDA ending the quarter at 1.1 times.

We would like to first and foremost continued to think see thank you.

To our 2000 plus team members who have.

Adjusted in the past six months and who have made the necessary changes. So that we can be able to continue to operate safely around the world. This has not been easy on anyone and our team is no exception.

Our primary focus besides keeping everyone safe continues to be meeting our customers needs through this crisis.

As we communicated since the beginning of this year operations continued to rank globally without interruption.

We continue to work with our customers to meet their needs.

As well as we all.

As well skews me as we adjust to the changing economic environment.

Helping our customers through these uncertain times continues to be a top priority.

We are encouraged by the operating results of arbitrage game additives business and we expect the global market will continue to improve as government restrictions on the movement of people goods and services are used as modern transportation in machinery cannot function without our products.

The rate of improvement will depend heavily on the rate at which these restrictions are lifted and remain lifted and the overall economic environment improving.

Thank you for joining us for the call today, we hope you are all healthy and staying safe.

Christy that concludes their planned comments for today and thank you all for attending and we look forward to talking to you at the end of the next quarter.

[laughter] today's teleconference.

You may disconnect your lines at this time and have a wonderful day.

[music].