Q1 2025 Innospec Inc Earnings Call
Operator: Thank you.
Operator: Welcome to Innospec's first quarter earnings call.
Thank you welcome to aspects first quarter earnings call.
Operator: The earnings released for the quarter in this presentation are posted on the company's website. During this call, we will make forward-looking statements, which are predictions and projections about future events. These statements are based on current expectations and assumptions that are subject to risk and uncertainties that could cause actual results to differ materially from anticipated results implied by such forward-looking statements. The risk and uncertainties are detailed in Innospec's 10-K, 10-Qs, and other filings with the SEC.
The earnings release for the quarter in this presentation are posted on the company's website. During this call. We will make forward looking statements, which are predictions and projections about future events. These.
These statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially from anticipated results implied by such forward looking statements.
The risks and uncertainties are detailed in our SEC 10-K, 10-Q, and other filings with the SEC.
Operator: Please see the SEC site and Innospec's site for these and related documents. In today's presentation, and we've also included non-GAAP financial measures, a reconciliation to the most directly comparable GAAP financial measure is contained in the earnings release. The non-GAAP financial measures should not be considered as a substitute for or superior to those prepared in accordance with GAAP. They are included as additional items to aid investor understanding of the company's performance in addition to the impact that these items and events had on financial results.
So you see the FTC site inspect site for these and related documents.
Today's presentation and we've also included non-GAAP financial measures a reconciliation to the most directly comparable GAAP financial measure is contained in the earnings release.
The non-GAAP financial measures should not be considered as a substitute for or superior to those prepared in accordance with GAAP Barracuda as additional items to aid investors understanding of the company's performance. In addition to the impact that the current events had on financial results with me today from minutes bag are Patrick Williams, President and Chief Executive Officer, and impairments and executive Vice President.
Patrick Williams: With me today from Innospec are Patrick Williams, President and Chief Executive Officer, and Ian Cleminson, Executive Vice President and Chief Financial Officer, and with that, turn it over to you, Patrick. Thank you, David, and welcome everyone to Innospec's first quarter 2025 conference call. This was a good quarter for Inspect with overall results in line with our expectations. Against an increasingly volatile economic backdrop, our balanced portfolio benefited from strong growth in fuel specialties, which offset lower results in performance chemicals and oil field services. Performance Chemicals began the quarter with good momentum, similar to other companies. activity moderated due to April 2 tariff analysis.
Patrick Williams: And Chief financial Officer, and with that ill turn it over to Patrick.
Speaker Change: Thank you David and welcome everyone to <unk> first quarter 2025 conference call.
Speaker Change: This was a good quarter for respect with the overall results in line with our expectations.
Speaker Change: It gets increasingly volatile economic backdrop, our balanced portfolio benefited from strong growth in fuel specialties, which offset lower results in performance chemicals and oilfield services.
Speaker Change: Performance chemicals, Ben began the quarter with good momentum similar to other companies.
Speaker Change: Activity moderated due to April two tariff announcements while.
Patrick Williams: While the majority of our products go into consumer staples, we believe that customers will remain conservative and manage inventory levels closely in the short term, while uncertainty surrounding trade policy remains. While the second quarter started broadly similar to the first, market conditions are extremely volatile. We currently expect these conditions to be a headwind against our stated 2025 target for sequential improvement in operating income.
Speaker Change: While the majority of our products go into consumer Staples, we believe the customers will remain conservative and manage inventory levels closely in the short term while uncertainties surrounding trade policy remains.
Speaker Change: While the second quarter started broadly similar to the first market conditions are extremely volatile.
Speaker Change: We currently expect these conditions to be a headwind against our stated 2025 target for sequential improvement in operating income.
Patrick Williams: Despite these near-term challenges, our pipeline continues to develop in all end markets, and we do not see any change in our customers' long-term drive towards technologies which deliver superior performance and value.
Speaker Change: Despite these near term challenges our pipeline continues to develop in all end markets and we do not see any change in our customers' long term drive towards technologies, which deliver superior performance and value.
Patrick Williams: Field Specialties had an excellent quarter. Operating income grew by double digits and margins expanded. The team continued to make progress on margin improvement with all regions contributing to the strong performance.
Speaker Change: Fuel specialties had an excellent quarter operating income grew by double digits and margins expanded.
Speaker Change: The team continued to make progress on margin improvement with all regions contributing to the strong performance.
Patrick Williams: While there is significant uncertainty in the current market, global fuel demand has historically been relatively steady through economic cycles. In addition, our field specialist business has been a consistent high margin strong cash generator. against this backdrop remain focused on delivering full year operating income growth and margin improvement.
Speaker Change: While there is significant uncertainty in the current market global fuel demand has historically been a relatively steady through economic cycles.
Speaker Change: Our fuel specialties business has been quite consistent high margin strong cash generator.
Speaker Change: Against this backdrop, we remain focused on delivering full year operating income growth and margin improvement.
Patrick Williams: Oilfield services operating income and margins were below our target and expectation. Operating income has declined on a sequential basis on lower-than-expected activity.
Oilfield services operating income margins were below our target and expectations.
Speaker Change: Operating income declined on a sequential basis on lower than expected activity.
Patrick Williams: As expected, there were no sales in Latin America and any potential recovery is likely delayed due to the indirect impact of ongoing trade policy negotiations. These declines were partially offset by continued growth and strong performance in our Middle East and our DRA business. We remain on track to bring our previously announced expansion for our market-leading proprietary DRA technology online in the fourth quarter. In addition to our top line initiatives, we've begun to a series of actions to align our U.S. cost structure with the market. We expect these initiatives to drive sequential operating income and margin improvement in the coming quarters and leave us well positioned for profitable growth.
Speaker Change: As expected there were no sales in Latin America, and any potential recovery is likely delayed due to the indirect impact of ongoing trade policy negotiations.
Speaker Change: These declines were partially offset by continued growth and strong performance in our middle East and our DRA business.
Speaker Change: We remain on track to bring our previously announced expansion for our market, leading proprietary DRA technology online in the fourth quarter.
Speaker Change: In addition to our top line initiatives.
Speaker Change: We have begun to a series of actions to align our U.S. cost structure with the market. We expect these initiatives to drive the virtual operating income and margin improvement in the coming quarters and leave us well positioned for profitable growth.
Ian Cleminson: Now I will turn the call over to Ian Cleminson, who will review our financial results in more detail.
Patrick Williams: Then I will return with some concluding comments. After that, Ian and I will take your questions.
Ian Cleminson: Thanks Patrick. Total Revenues for the First Quarter 440.8 million a 12% decrease from 500.2 million a year ago. Overall gross margin decreased by 2.7 percentage points from last year to 28.4 percent. Adjusted EBITDA for the quarter was £54 million compared to £64 million last year and net income for the quarter was £32.8 million compared to £41.4 million a year ago. Our gap earnings per share were $1.31, including special items, the net effect of which decreased our first quarter earnings by 11 cents per share. A year ago, we reported gap earnings per share of $1.65, which included a negative impact from special items of $0.10 per share.
Speaker Change: Total revenues for the first quarter with $440 8 million.
Speaker Change: A 12% decrease from $500 2 million a year ago.
Speaker Change: Overall gross margin decreased by three seven percentage points from last year to 28, 4%.
Speaker Change: Adjusted EBITDA for the quarter was $54 million compared to $64 million last year.
Speaker Change: Income for the quarter was $32 8 million compared to $41 4 million a year ago.
Speaker Change: Our GAAP earnings per share were $1 31.
Speaker Change: Including special items, the net effect of which decreased our first quarter earnings by 11% to share.
Speaker Change: A year ago, we reported GAAP earnings per share of $1 65.
Speaker Change: Which included the negative impact from special items of <unk> 10 per share.
Ian Cleminson: Excluding special items in both years, our adjusted EPS for the quarter was $1.42 compared to $1.75 a year ago. Turning to slide 8, revenues in performance chemicals for the first quarter were £168.4 million, up 5% from last year's £160.8 million. Volume growth of five. positive price mix of 3% were offset by a negative currency impact of 3%. Gross margins of 21% decreased 2.4 percentage points compared to 23.4% in the same quarter in 2024 due to a weaker sales mix and lower sales prices. Operating income of £19.8 million decreased 6% on £21.1 million last year. Moving on to slide 9, revenues in fuel specialties for the first quarter were £170.3 million, down 4% from the £176.9 million reported a year ago.
Speaker Change: Excluding special items in both years, our adjusted EPS for the quarter was $1 42.
Speaker Change: Compared to $1 75.
Speaker Change: A year ago.
Speaker Change: Turning to slide eight revenues in performance chemicals for the first quarter were $168 4 million up 5% from last year's $168 million.
Speaker Change: Volume growth of 5% and a positive price mix of 3% were offset by a negative currency impact of 3%.
Speaker Change: Gross margins of 21% decreased two four percentage points compared to 23, 4% in the same.
Speaker Change: One quarter in 2024, due to a weaker sales mix and lower sales pricing.
Speaker Change: Operating income of $19 8 million decreased 6% on $21 1 million last year.
Speaker Change: Moving on to slide nine.
Speaker Change: He is in fuel specialties for the first quarter were $173 million down 4% from the 176 9 million reported a year ago.
Ian Cleminson: with a 2% adverse price mix and a negative currency impact of 2%. Fuel Specialty's gross margins of 35.7% were 1.4 percentage points above the same quarter last year, benefiting from a stronger sales mix and stable prices. Operating income of £36.9 million was up 10% from £33.4 million a year ago. Moving on to slide 10, revenues and oilfield services for the quarter were 102.1 million, down 37% from 162.5 million in the first quarter last year, driven mostly by a lack of Latin American business. Gross margins of 28.4% decreased 6.9 percentage points from last year's 35.3% on a week of salesmake.
Speaker Change: With a 2% adverse price mix and a negative currency impact of 2%.
Speaker Change: Fuel specialties gross margins of 35, 7% for one four percentage points above the same quarter last year <unk>.
Speaker Change: Benefiting from a stronger sales mix and stable pricing.
Speaker Change: Operating income of $36 9 million was up 10% from $33 4 million a year ago.
Speaker Change: Moving on to slide 10 revenues in oilfield services for the quarter were $102 1 million down 37% from $162 5 million in the first quarter last year, driven mostly by a lack of Latin American business.
Speaker Change: Gross margins of 28, 4% decreased six nine percentage points from last year's 35, 3% on a weaker sales mix.
Ian Cleminson: Operating income of £4.1 million decreased 76% from £16.9 million one year ago.
Speaker Change: Operating income of $4 1 million decreased 76% from 16.9 billion one year ago.
Ian Cleminson: It is now over a year since we made sales to our major Latin America customers. From Q2 onwards, our quarterly results will be directly comparable and not show the sharp decreases we have seen year over year from this one piece of business. Turning to slide 11, corporate costs for the quarter were £17.7 million compared with £20.2 million a year ago, driven by lower personnel related costs. The effective tap rate for the quarter was 26.1% compared to 25.1% a year ago. Moving on to slide 12, cash from operating activities was £28.3 million before capital expenditures of £15.5 million.
Speaker Change: It is now over a year since we made sales to a major Latin American customer.
Speaker Change: From Q2 onwards, our quarter results will be directly comparable and not show the sharp decreases we have seen year over year from this one piece of business.
Speaker Change: Turning to slide 11, corporate costs for the quarter was $17 7 million compared with $20 2 million a year ago, driven by lower personnel related costs.
Speaker Change: The effective tax rate for the quarter was 26, 1% compared to 25, 1% a year ago.
Speaker Change: Moving on to slide 12 cash from operating activities was $28 3 million before capital expenditures of $15 $5 million.
Ian Cleminson: On the first quarter, we bought back 34,100 shares at a cost of £3.3 million. As of March 31st, Innospec had £299.8 million in cash and cash equivalents and no debt.
Speaker Change: For the first quarter, we bought back 34100 shares at a cost of $3 3 million.
Speaker Change: As of March 31st.
Speaker Change: <unk> had $299 8 million in cash and cash equivalents and no debt.
Patrick Williams: And now I'll turn it back over to Patrick for some final comments. Thank you, Ian. With our diversified global supply chain and manufacturing locations, we believe that we are well positioned to manage the direct impacts of the global tariff. Despite any near-term volatility, we remain focused on our continued commitment to security of supply, innovation, and world-class customer service. We will continue to implement improvements across all our businesses that will position us for growth and margin expansion as market conditions recover. Our strong debt-free balance sheet allows for significant flexibility in the current environment to pursue further M&A, dividend growth, organic investment, and buyback.
Patrick Williams: And now I'll turn it back over to Patrick for some final comments.
Patrick Williams: Thank you Ian without diversified global supply chain and manufacturing locations. We believe that we are well positioned to manage the direct impacts of the global tariffs.
Patrick Williams: Despite any near term volatility we remain focused on our continued commitment to security of supply innovation and world class customer service.
Patrick Williams: We will continue to implement improvements across all of our businesses that will position us for growth and margin expansion as market conditions recover.
Patrick Williams: Our strong debt free balance sheet allows for significant flexibility in the current environment to pursue further M&A dividend growth organic investments and buybacks.
Patrick Williams: Cash generation was again positive this quarter, and our net cash position increased to almost $300 million after purchasing 34,100 shares at a cost of $3.3 million.
Patrick Williams: Cash generation was again positive this quarter and our net cash position increased to almost $300 million. After purchasing 34100 shares at a cost of $3 3 million.
Patrick Williams: In addition, this quarter our board approved a further 10% increase in our semi-annual dividend to $0.84 per share, continuing our record of returning value to shareholders.
Patrick Williams: In addition, this quarter our board approved a further 10% increase in our semiannual dividend to <unk> 84 per share continuing our record of returning value to shareholders.
Operator: Now I will turn the call over to the operator, and Ian and I will take your questions. Thank you, dear participants. As a reminder, if you wish to ask a question, please press star 11 on your telephone keypad and wait for a name to be announced. To withdraw a question, please press star 11 again.
Patrick Williams: Now I will turn the call over the operator, and he and I will take your questions.
Speaker Change: Thank you Dear participants as a reminder, if you wish to ask a question. Please press star one one on the telephone keypad and like finance will be announced to withdraw your question. Please press star one again please.
Operator: Please stand by while we compile the Q&A or studies. We'll take a few moments.
Speaker Change: Please somebody will compile the Q&A roster this will take a few moments.
Speaker Change: Yes.
Operator: And now we're going to take our first question.
Speaker Change: Okay.
Speaker Change: And that won't go Goldman to take the first question.
Operator: And it comes from the line of Mike Harrison from Seaport Research Partners. Your line is open. Please ask your question. Hi, good morning. Morning, Mike.
Speaker Change: And it comes from the line of Mike Harrison from Seaport Research Partners. Your line is open. Please ask your question.
Mike Harrison: Hi, good morning.
Speaker Change: Good morning, Mike.
Mike Harrison: I was hoping that you could give us maybe a little bit more detail on how you guys are looking at the direct impact of tariffs. Any and Jonathan Tanwanteng, David Jones, Ian Cleminson, Innospec Inc. portions of your business where you're maybe exporting out of the U.S. and could see some of your products affected by tariffs or bringing product into the U.S. Yeah, Mike, I'll let Ian start with that question. I'm sure I have some additional information to add. Sure, so Mike, you know, like many other companies, we're monitoring the situation. It changes daily, so it's not an easy backdrop to PlanetGate, but our supply chains are really well positioned to source and manufacture across the different regions.
Mike Harrison: Morning, Mike.
Speaker Change: I was hoping that you could give us maybe a little bit more detail on how you guys are looking at the direct impact of tariff.
Mike Harrison: Any.
Mike Harrison: Color that you can provide on what <unk> could mean to your input costs and if you could also give us any detail on.
Mike Harrison: Portions of your business, where you're maybe exporting out of the U S.
Mike Harrison: And could see some of your products are affected by tariffs.
Mike Harrison: Tariffs or bringing product into the U S I guess.
Mike Harrison: Yeah, Mike I'll, let Ian.
Mike Harrison: With that question I'm sure I've sold some additional information to add.
Speaker Change: Sure So Mike.
Speaker Change: Many of the companies that win powertrain situation.
Speaker Change: It changes daily.
Speaker Change: Not uneasy.
Speaker Change: Dropped to planning gains, but our supply chains are really well positioned.
Speaker Change: Source and manufacture across the different regions.
Ian Cleminson: We have various optionality there, which we can implement. So we're monitoring tariffs, and a lot of that is really an extension of the supply chain and logistics problems that we've seen over the last number of years, including during the pandemic. So, as more details emerge... position ourselves accordingly. What we're not going to do is make knee-jerk reactions, change manufacturing, change supply chain, until we're absolutely certain of the background position. In terms of the general impact, they're not that high. Our trade with China, both in terms of raw materials and finished products, is pretty low. We do have a lot of from Europe into the US and from the US into Europe.
Speaker Change: We have various optionality that which we can implement.
Speaker Change: So we're monitoring palace tariffs and a lot of that.
Speaker Change: It's really an extension of the supply chain.
Speaker Change: And logistics have problems that we've seen over the last number of years, including during the pandemic. So as more details emerge we will position ourselves accordingly, what we're not going to do is make knee jerk reactions change manufacturing change supply chain.
Speaker Change: Until we're absolutely certain of that.
Speaker Change: The background position.
Speaker Change: In terms of the general impacts that.
Speaker Change: Hi, all trade with China, both in terms of raw materials and finished products is pretty low.
Speaker Change: We do have a lot of trade from Europe.
Speaker Change: Into the U S and from the U S into Europe. So each of the business is slightly differently impacted.
Ian Cleminson: So each of the businesses is slightly differently impacted. We believe that in performance chemicals, the main impact will not be economic in terms of the impact of tariffs. It'll actually be on the consumer and the customer caution that we've seen in the first quarter. We think that'll be the main headwind. But that doesn't change our focus on the R&D and the investment in the technologies that we've got. We don't think that changes any direction from our customers. I think in fuel specialties, again, that's a business that is regionally based. I think we can handle all the different dynamics there.
Speaker Change: We believe that in performance chemicals, the main impacts will not be economic.
Speaker Change: Terms of the impacts of tariffs so you'll actually be on the the consumer and the cost of a caution but we've seen in the first quarter, we think that will be the main headwind.
Speaker Change: That doesn't change our focus on the R&D and the investment in the technologies that we've got and we don't think that changes any direction from our customers.
Speaker Change: I think in fuel specialties again, that's a business that is a regionally based.
Speaker Change: We can handle all the different <unk>.
Ian Cleminson: And as we've moved through different economic cycles with our business, it tends to be a fairly stable business. So we don't expect there to be any financial impacts or any economic headwinds in that business.
Speaker Change: Dynamics, there and as we've moved through different economic cycles without business. It tends to be a fairly stable business. So we don't expect there to be any financial impacts or any economic headwinds in that business and I think in oilfield. Our main concern is.
Ian Cleminson: And I think in oil field, our main concern is with Mexico and the difficult negotiations that are going on there. That's likely to delay any resumption of the Mexican business, which we lost just over a year ago. So there's a lot of moving parts across all our business, but most of it we think we can manage. And as long as we've got a firm and solid backdrop, we'll deal with what's in front of us.
Speaker Change: With Mexico.
Speaker Change: The difficult negotiations that goes on that that's likely to delight and a resumption of the Mexican business, which we lost just over a year ago. So there is a lot of moving parts.
Speaker Change: All our business, but most of most of it we think we can manage.
Speaker Change: Long as we've got a firm and solid backdrop.
Speaker Change: We will deal with what's in front of us.
Patrick Williams: Yeah, I think, Mike, that Ian covered it very, very well. You know, I think the key here is that you don't panic in markets like this. It'll work itself out, as Ian alluded to. We don't have a lot of imports or exports going from China and or India. I think that the positive is, too, is we have flexible assets. So if and when we need to turn those assets a different direction, we can do that. So we are in a strong position there. And I think another thing, a little bit of color to that, too, is, you know, Ian alluded to the consumer.
Speaker Change: Yes, I think Mike that Ian covered it very very well.
Speaker Change: I think the key here is that you don't panic in markets like this.
Speaker Change: It will work itself out as Ian alluded to.
Speaker Change: We don't have a lot of imports or exports going at from China <unk>, India.
Speaker Change: I think that the positive is to as we have flexible assets. So if and when we need to turn those assets a different direction, we can do that.
Speaker Change: So we are in a strong position there and I think another thing a little bit of color to that too is <unk>.
Speaker Change: Alluded to the consumer it's.
Patrick Williams: It's interesting watching what's going on, because in Q1, you know, if you look at January and a half of February and let's call it in performance chemicals, great order pattern, everybody was excited. And then all of a sudden, all the tariff talk hit and things slowed down. We are starting to see pickup again, starting in Q2. So it's going to be interesting to see how this plays out over the next 90 days. And see where everything falls out with all the tariff conversation.
Speaker Change: Interesting watching what's gone on because in Q1.
Speaker Change: You look at January three and a half of February and let's call. It in performance chemicals, Great order pattern everybody was excited and then all of a sudden all the tariff talk hit and things slowed down we are starting to see pickup again, starting in Q2, so it's going to be interesting to see how this plays out over the next 90 days and see where ever.
Speaker Change: <unk> falls out with all the tariff conversations.
Mike Harrison: All right, that's very helpful.
Speaker Change: Alright.
Mike Harrison: I wanted to dig in on the performance chemicals business. You just mentioned that you've seen kind of a Eric Marshall, M.D.: strengths to start the year and then a sharp weakening and now some improvement, we tend to think of that as being a pretty resilient business selling into mostly personal care and some household applications. So, I'm curious, you know, do you think what you're seeing there in those trends is related more to what your customers are doing to manage inventory levels and production? Or is this more of an end consumer, you know, trade down or weakening?
Speaker Change: That's very helpful. I wanted to dig in on the performance chemicals business.
Speaker Change: You just mentioned that you've seen kind of.
Speaker Change: Strength to start the year, and then a sharp weakening and now some improvement.
Speaker Change: We tend to think of that as being a pretty resilient business selling into mostly personal care and some household applications.
Speaker Change: So I'm curious do you think what you're seeing there in those trend is related more to what your customers are doing to manage inventory levels and production.
Speaker Change: Is this more of an end consumer.
Patrick Williams: And then I guess the second piece of that is just your commentary around the margin trajectory there. Um, you know, is that really just having to do with volume leverage or, you know, are there changes in mix or price cost pressures or other factors that are playing into your, your more cautious view on the margin perform in performance? Yeah, I'll start with the first part of your question. I think it was a little bit of both. I think when, you know, for instance, when COVID hit, and you saw a lot of our customers stuck with inventory, didn't know what the consumer was going to do, there was complete panic in the marketplace.
Speaker Change: Trade down or weakening.
Speaker Change: And then I guess the second piece of that is just your commentary around the margin trajectory there.
Speaker Change: <unk>.
Speaker Change: Is that really just having to do with volume leverage.
Speaker Change: Or are there changes in mix or price cost pressures or other factors.
Speaker Change: That are playing into your more cautious view on the margin performed in performance chemicals.
Speaker Change: Yeah, I'll start with the first part of your question.
It was a little bit of both I think when for instance, when Covid hit and you saw a lot of our customers stuck with inventory didn't know what the consumer was going to do there was complete panic in the market place. This is not like cover from that standpoint. This was a reset button, where the customer said our customers set.
Patrick Williams: This is not like COVID from that standpoint. This was a reset button where the customer said, our customers said, what's the consumer going to do, right? And until we know that, we're just going to pull back a little bit. I think that's starting to filter its way out. I do think that this agreement with the UK is a start of other agreements to come, I think, especially in Europe. So, I think that will be a net positive over the short and long term. But we're starting to see the consumer settle down a little bit. You know, there's still a big concern around inflationary pricing.
Speaker Change: What's the consumer going to do.
Speaker Change: And until we know that we're just going to pull back a little bit.
Speaker Change: I think thats starting to filter its way out I do think that disagreement with with the U K is a start of other agreements to come.
Speaker Change: Especially in Europe.
Speaker Change: So I think that's it.
Speaker Change: It will be a net positive over the short and long term, but we're starting to see the consumer settled down a little bit they are still the big concern around inflationary pricing. There is still big concerns about global recession, but we haven't seen the panic button and we are starting to see that increase which is a positive and our.
Patrick Williams: There's still big concerns about a global recession. But we haven't seen the panic button, and we are starting to see that increase, which is a positive. And our customers who are directly related to the consumer are starting to buy again. So, that's a positive.
Speaker Change: Mers, who were directly related to the consumer are starting to buy again, so that's a positive.
Patrick Williams: We won't really be able to kind of give you more guidance than that until we see how these next couple of months go due to the volatility in the marketplace. So, we'll just sit tight and kind of give you guys as much feedback as we can. In regards to pricing, it was mixed. I also think, and there's a plan going on internally in all of our businesses on margin improvement and cost improvement. And so, we're doing that across all three of our business units. But a lot of what happened is you had good volume, but you didn't have the best mix.
Speaker Change: We won't really be able to kind of give you more guidance than that until we see how these next couple of months ago due to the volatility in the marketplace. So we'll just sit tight and kind of give you guys as much feedback as we can.
Speaker Change: In regard to pricing it was mix.
Speaker Change: I also think and Theres a plan going on internally in all of our businesses on margin improvement and cost improvement.
So we're doing that across all three of our business units, but a lot of what happened is you had good volume, but you had didnt have the best mix and I think that thats going to work itself out over time as well. So I do think we're sitting in a good position I think there is just a wait and see mode to see kind of what happens over the next 90 days.
Patrick Williams: And I think that that's going to work itself out over time as well. So, I do think we're sitting in a good position. I think there is just a wait and see mode to see kind of what happens over the next 90 days.
Patrick Williams: All right, and then you specifically mentioned some cost actions that you're taking within the oilfield business. And I was just curious if you could, you know, give some additional detail on what you're Yeah, I mean, it's overall it's it's consolidation of assets. It's personnel. It's efficiencies. It's raw material costing it. There's a lot of things that we're doing that we've been working on.
Speaker Change: Alright, and then you specifically mentioned some cost actions that you're taking within the oilfield.
Speaker Change: Business and I was just curious if you could.
Speaker Change: Give us some additional detail on what Youre doing there.
Speaker Change: Yes, I mean, it's overall, it's consolidation of assets its personnel its efficiencies.
Speaker Change: Raw material costing.
Speaker Change: There's a lot of things that we're doing that we've been working on its ongoing but we should start seeing those benefits.
Patrick Williams: It's ongoing, but we should start seeing those benefits at least in Q3 and Q4, but these are cost initiatives that have been going on for quite some time. And we have really put the pressure on to get these moving. It's a, it's an interesting dynamics in the market right now with crude prices where they are and what's going on globally and OPEC increasing their production. You know, and the good thing is about that business is it's well diversified now. I think if we get some things right in the US, there's a lot of upside and obviously, if our Latin America customer comes back, which we do think we still think they will at some time.
In Q3 and Q4.
Speaker Change: But these are cost initiatives that have been going on for quite some time and we have really put the pressure on to get these moving.
Speaker Change: It's an interesting dynamics in the market right now with crude prices, where they are and what's going on globally in OPEC increasing their production.
Speaker Change: The good thing about that business its well diversified now.
Speaker Change: I think if we get some things right in the U S. There is a lot of upside.
Speaker Change: And obviously, if our Latin American customer comes back, which we do think we still think they will at some time.
Patrick Williams: That's gonna be a net positive overall when that happens.
Speaker Change: That's going to be a net positive both for all when that happens.
Mike Harrison: The last question for me is just if you can walk through maybe how we should be thinking about earnings cadence for the rest of the year. I'm curious, you know, when I look at overall operating income, is Q2 expected to be sequentially lower and then maybe we get back to sequential improvement for the rest of the year? I know it's kind of a limited visibility environment but any any color that you could provide on the outlook would be very helpful.
Speaker Change: Alright last question for me is just if you can walk through maybe how we should be thinking about earning earnings cadence for the rest of the year I am curious when I look at overall operating income.
Speaker Change: Is Q2 expected to be sequentially lower and then maybe we get back to sequential improvement for the rest of the year I know, it's kind of a.
Speaker Change: Limited visibility environment, but any any color you can provide on the outlook would.
Mike Harrison: Thank you.
Speaker Change: It would be very helpful. Thanks.
Patrick Williams: Oh, Mike, let me, let me touch.
Mike Harrison: Hey, Mike Let me, let me take that one.
Patrick Williams: And I'll go business by business because it's probably a little bit easier. We think fuel specialties will be right on target for the full year. We don't think it will be far off the expectations that that you set and the other analysts have set for the full year. Obviously, the second quarter and the third quarter do tend to dip down a little bit. That's seasonally driven, but we don't see any impacts from tariffs and we don't see any economic impacts blowing that business offline. So I think in the second quarter in fuels, you'll see you'll see the revenues come off a little bit and you'll see the operating income come down a little bit.
Speaker Change: And I'll go business by business, because he is probably a little bit easier.
We think field specialties.
Speaker Change: You're right on target for the full year we.
Speaker Change: We don't think he'll be far off the expectations that you set and the other analysts have set for the full year, obviously, the second quarter to the third quarter, two tenths of downloaded that seasonally driven.
Speaker Change: But we don't see any impacts.
Speaker Change: Had some tariffs we don't see any economic impacts blow in that business.
Speaker Change: Offline. So I think in the second quarter and fields, you'll say you will see the revenues come off a little bit and you'll see operating income come down a little bit but that is all part of the seasonality and I think the way you've modeled it by the way we see it for the second quarter.
Patrick Williams: But that is all part of the seasonality. And I think the way you've modelled it, Mike, is the way we see it for the second quarter. I think in performance chemicals, I think what we'll probably see is a second quarter very similar to the first quarter in terms of sales, gross margins and operating income. And I think for the rest of the year, that's that's the sort of level that we expect the business will continue to operate that absent any real fundamental change in the backdrop. I think certainly for the second and third quarter, that's what we expect.
Speaker Change: In performance chemicals.
Speaker Change: I think what will probably say is second.
Speaker Change: Second quarter very similar to the first quarter in.
Speaker Change: In terms of sales gross margins and operating income.
Speaker Change: For the rest of the year, that's that's the sort of level that we expect the business will continue to operate so absent any real fundamental change in the backdrop I think certainly for the second and third quarter. That's what we expect if things shake out more positively.
Patrick Williams: If things shake out more positively, we'd expect that business to improve its margins and improve its operating income. But for now, I think Q1 is reflective of what we'll see in the second quarter.
Speaker Change: We would expect that business to improve its margins and in previous upright staying cookbook for now I think Q1 is reflective of what we'll say in the second quarter and then for oilfield.
Patrick Williams: And then for oilfield, as we've talked about on the call already, there's a lot of initiatives going on, not just to cut costs and not just to reorganise internally, but to also grow that business. And we've got some really strong areas of growth in the Middle East and DRA and other parts of the business that we want to continue to push hard. But we do need to right size ourselves other places. So our expectation for the second quarter is something similar, if not slightly better than the first quarter. The third quarter again should be sequentially improved and then hopefully the fourth quarter will improve again.
Speaker Change: As we've talked about on the call already there's a lot of initiatives going on.
Speaker Change: Just to cut costs and not just that.
Speaker Change: To reorganizing thirdly books also grow that business and we've got some really strong areas of growth in the middle East and day Alright.
Speaker Change: Parts of the business that we want to continue to push hard but.
Speaker Change: We do need to rightsize ourselves other places so our expectation for the second quarter is something similar if not slightly better than the first quarter.
Speaker Change: Third quarter again should be sequentially improved and then hopefully the fourth quarter will improve again so from here on in we expect to see some very slight improvement in our oilfield business. We expect performance chemicals to be pretty similar to Q1, we expect our fuels business to be absolutely on target for the full.
Patrick Williams: So from here on in, we expect to see some very slight improvement in our oilfield business. We expect performance chemicals to be pretty similar to Q1 and we expect our upfields business to be absolutely on target for the full year.
Speaker Change: Yes.
Mike Harrison: All right, sounds good.
Operator: Thank you very much.
All right sounds good thank you very much.
Speaker Change: Thank you Mike.
Operator: Now we're going to take our next question.
Speaker Change: Now I will go and take our next question.
Operator: And the question comes from the line of Jonathan Tanwanteng from... CJ Securities. Your line is open, please ask your question. Hi. Thank you for taking my questions. I was wondering if you could dig a little bit deeper into your expectation for, you know, fuel specialties being relatively unaffected, just because I've seen a couple of forecasts that are suggesting that fuel volumes and pricing are going to decline, you know, as we see these ships come in with, you know, half loads and trucking, you know, to follow that. Just any thoughts on how those two reconcile if you don't believe them or if it's just too small of a volume to matter in a global context, any help there would be.
Speaker Change: And the question comes from the line of John Kim from.
Speaker Change: C J Securities. Your line is open please ask your question.
Speaker Change: Hi, Thank you for taking my questions I was wondering if you could dig a little deeper into your expectation for sure.
Speaker Change: Fuel specialties being relatively unaffected just because I've seen a couple of forecasts that are suggesting that that fuel volumes and pricing decline.
Speaker Change: As we see these ships come in with half loads and trucking to follow that.
Any thoughts on how the two reconcile if you don't believe them or if it's just too small volume to matter in a global context any help there would be appreciated.
Jonathan Tanwanteng: Yeah, John, I think in the global context.
Speaker Change: Yes, John I think in the global context.
Patrick Williams: If you look historically at fuel specialties, whether it's recessionary environment, inflationary environment, it's always been historically a very stable business, not only from a cash flow, but from a revenue and operating income standpoint. We don't see, there's puts and takes in that business that will maybe see some negative on fuels, but a positive on the other side. So, we just don't see it. Our order patterns don't show it. Our customer communication is telling us otherwise. And because of resiliency of that business, as Ian alluded to, we see a strong year for that business moving forward.
John Kim: If you look historically at fuel specialties, whether its recessionary environment inflationary environment.
John Kim: It's always been historically, a very stable business not only from a cash flow, but from a revenue and operating income standpoint.
John Kim: We don't see Theres puts and takes in that business that we'll see maybe see some negative yields but a positive on the other side.
John Kim: So we just don't see it.
John Kim: Order patterns don't show it.
John Kim: Our customer communication is telling us otherwise.
John Kim: And because of the resiliency of that business.
John Kim: Zane alluded to we see we see a strong year for that business moving forward.
Jonathan Tanwanteng: Okay, great. Thank you.
Ian Cleminson: And then, Ian, if you could more specifically quantify what's moving between Europe and the U.S., you know, either one way or the other, just to help us understand the exposures on a tariff perspective, and if you have a number for China, that would be helpful, too. Yeah, I'm not going to give you specifics. I can say it's pretty immaterial across the group. very, very low on China, both ways. We sell very little into China and we import very little raw materials directly into the US. So we don't see a problem there. Trade between the US and Europe and Europe and the US, a lot of that can be into company.
John Kim: Okay, great. Thank you and then if you could more specifically quantify whats moving between.
Speaker Change: Europe and the U S either one way or the other just to help us understand the exposures on a tariff perspective, and if you have a number for China that that would be helpful too.
John Kim: Yes, I'm not going to give you specific numbers, John but what I can say is it's pretty immaterial across the group.
Speaker Change: Very very low on China, both ways, we sell very little into.
Into China, we import very little raw materials directly into the U S. So we don't say a problem there.
Speaker Change: Trade between the U S.
Speaker Change: Europe in Europe, and the U S.
Ian Cleminson: A lot of it can be services, which so far exempt from the tariffs. So, that was where we will see some impacts, but this is where we've got the most. We can move our manufacturing assets, and we can flex what we want to do, and we can flex the supply chain somewhat. So it's not something that we're ignoring. It's not something that we're panicking about, but we have options. But we're not talking hundreds of millions of dollars here, John. We're talking very manageable amounts that we feel that we can navigate our way through.
Speaker Change: That can begin to complete.
A lot of it can be services, which so far are exempt from the tariffs.
Speaker Change: So that was where we will see some impact but this is why we've got the most flexibility where we can move our manufacturing assets.
Speaker Change: Can flex what we work today and we can flex the supply.
Our supply chain. So long so it's not something that were Rick noted, it's not something that were panicking about it but we have options, but it's not we're not talking hundreds of millions of dollars a jumbo. So can you have a very manageable amounts that we feel that we can navigate our way through it.
Jonathan Tanwanteng: Okay, great. Thank you.
Patrick Williams: And then lastly, you mentioned that you saw a little bit of a pickup in the trends and performance chemicals in this quarter as I guess as negotiations have gone and people have maybe assumed the tariffs won't be as bad. I'm wondering if you've seen the same pickup in oil field or the expectation for I guess sequential improvement is more of your internal efforts than maybe overall. Yeah, I think overall, in in oil field, a lot of it's going to be internal efforts. As we alluded to in our previous conversations that we're hoping to see that Latin American business come back.
Speaker Change: Okay, great. Thank you and then lastly, you mentioned that you saw a little bit of a pickup in the trends in performance chemicals and in this quarter as I guess those negotiations have gone and people have maybe assume that tariffs won't be as bad I'm wondering if you've seen the same pickup in oilfield or the expectation for I guess sequential improvement as more of your internal efforts.
Speaker Change: And then maybe overall demand.
Speaker Change: Yes, I think overall.
Speaker Change: In order to build a lot of it is going to be internal efforts.
Speaker Change: As we alluded to in our previous conversations that.
Speaker Change: We're hoping to see that Latin American business come back.
Patrick Williams: We've expanded more into the Middle East, we're expanding our DRA capacity, which is going to be beneficial to that business, and we're streamlining things in the U.S. which needs to be done. A lot of the pullback on crude is, yes, you had OPEC add some barrels to the market, but more importantly, as you said earlier, John, is that people were discussing, is there going to be a slowdown, is the consumer going to slow down driving, things of that nature, the fear is starting to subside. And so I do think that you're going to see some stabilization.
Speaker Change: We've expanded more into the middle East.
Speaker Change: We've expanded our we're expanding our DRA capacity.
Speaker Change: Which is going to be beneficial to that business.
Speaker Change: And we're streamlining things in the U S, which needs to be done.
Speaker Change: A lot of the pull back on crude is yes, you had OPEC add some barrels to the market, but more importantly is as you said earlier John is that people were discussing is there going to be a slow down as the consumer going to slow down driving things of that nature. The fear is starting to subside.
Speaker Change: And so I do think that youre going to see some stabilization I think if you look at crude over the last couple of days, it's gone up.
Patrick Williams: I think if you look at crude over the last couple of days, it's gone up. And I think, you know, as long as we're not seeing a complete crash in crude prices, oil field service is going to be okay.
Speaker Change: And I think as long as as long as we're not seeing a complete crash in crude prices oilfield services going to be okay.
Jonathan Tanwanteng: Okay, great. Thank you.
Speaker Change: Okay, great. Thank you.
Speaker Change: Thank you. Thank you.
Operator: Dear participants, as a reminder, if you wish to ask a question, please press star 11 on your telephone keypad.
Speaker Change: Yeah participants as a reminder, if you wish to ask a question. Please press star one on your telephone keypad.
Operator: And now we're going to take our next question.
Speaker Change: And now we're going to take our next question.
Operator: And it comes from the line of David Silver from CL King & Associates. Your line is open, please ask your question. Yeah. Hi. Good morning. Thank you. Morning, David. Good morning. Yes. Good morning.
Speaker Change: And it comes from line of David Silver from CL, King and Associates. Your line is open please ask a question.
David Silver: Yes, hi, good morning. Thank you good morning, David Good morning, Hey, good morning.
Speaker Change: Yes, hi, good morning.
David Silver: So I have a question, I guess, more focused on your R&D efforts and collaborations in particular with key customers. So kind of projects that are due to develop over the next year or so, let's just say year or more. But, you know, with all the tariff uncertainty that you've highlighted, you know, I'm trying to draw maybe a contrast between how your customers are reacting near term versus maybe projects and collaborations with a longer timetable, let's say, to play out. So, I think your R&D spend this quarter was an all-time high and, you know, I was just wondering if you could maybe give us a sense of how your collaboration partners on product development and our, you know, just longer term R&D are reacting in the current environment.
Speaker Change: So I have a question I guess more focused on your R&D efforts and collaboration and particular with key customers. So kind of projects that are due to develop over the next year or so, let's just say year or more.
Speaker Change: But with all the tariff uncertainty that you've highlighted.
Speaker Change: Yes, I'm trying to draw maybe a contrast between how your customers are reacting near term.
Speaker Change: Versus maybe.
Speaker Change: Projects in collaboration with a longer time table lets say to play out.
Speaker Change: So.
Speaker Change: I think your R&D spend this quarter was an all time high.
Speaker Change: And.
Speaker Change: I was just wondering if you could maybe.
Speaker Change: Give us a sense of how your.
Speaker Change: Collaboration partners on product development and our.
Speaker Change: Longer term R&D are reacting in the current environment in other words is there any pause or they rethinking.
David Silver: In other words, is there any pause? Are they rethinking, you know, maybe the supply chain or the logistics shifting timetables? Just what would you say has been the feedback from your major customers that, you know, you're working on this kind of somewhat over the horizon projects? Thank you.
Speaker Change: Maybe the supply chain or the logistics.
Speaker Change: Shifting timetables, just what would you say.
Speaker Change: Has been the feedback from your major customers that you're working on this kind of slowed somewhat over the horizon projects. Thank you.
Patrick Williams: Yeah, David, we really haven't seen any change in the mindset across all three of our business units. You know, if you look at our R&D that we do joint collaboration with, there's specified projects for specified outcomes or performance. And then you have our disruptive technology that looks at what's over the next five to 10 years. What's that horizon look like? What's driving regulatory environment? What type of performance characteristics to look for? What's completely game changing? So, they're really two different sectors, but when you look at our actual customers that we do joint collaboration projects across all three business units, there hasn't been a change in mindset.
David Silver: Yes, David we really havent seen any change in the mindset.
Speaker Change: Across all three of our business units.
Speaker Change: If you look at our R&D that we do joint collaboration with or they are specified projects.
Speaker Change: Specified outcomes or performance.
When you have our disruptive technology that looks at what sort of the next five to 10 years, what's that horizon look like what's driving the regulatory environment what type of performance characteristics look more what's completely game changing so there are really two different sectors, but when you look at our actual customers that we do joint.
Speaker Change: Collaboration projects across all three business units there hasn't been a change in mindset.
Patrick Williams: Whether that's, as I said earlier, whether it's regulatory driven or performance driven, there hasn't been a mindset change whatsoever. So, that has not slowed down. You know, I think in some instances, quite frankly, it's probably picked up because they want to see something new to introduce to the market. So, it's actually a positive at some points in these times when you do see a little bit of increase in R&D, because people are starting to look at things differently, which is typically beneficial to us.
Speaker Change: Whether that's as I said earlier, whether it's regulatory driven our performance driven.
There hasn't been a mindset change whatsoever.
Speaker Change: That has not slowed down.
Speaker Change: In some instances quite frankly, it's probably picked up because they want to see something new to introduce to the market.
Speaker Change: So it's actually a positive at some points in these times when you do see a little bit of increase in R&D because people are starting to look at things differently, which is typically a beneficial to us.
Speaker Change: Okay.
David Silver: Okay, great. Thank you for that.
Speaker Change: Okay, great. Thank you for that.
David Silver: My next question would be just maybe to drill down a tiny bit on the fuel specialties quarter. So, you know, revenue was down. You said price mix was down a bit, but margins and operating income, you know, operating income was up double digits. And I'm just wondering if you could highlight maybe within your portfolio there, or your different product lines, where you think the greatest. improvement was was experienced this quarter. So I'm kind of wondering, but, you know, is jet fuel now? Has it been restored to its traditional, you know, share of your overall fuel specialties business?
Speaker Change: My next question would be just maybe to drill down a tiny bit on the fuel specialties quarter. So revenue was down you said price mix was down a bit but margins and operating income operating income was up double digits.
Speaker Change: Just wondering if you could highlight maybe within your.
Speaker Change: Portfolio there.
Speaker Change: Different product lines, where you think the greatest.
Speaker Change: Improvement.
Speaker Change: Was the experience this quarter, so I'm kind of wondering but.
Speaker Change: Is jet fuel now has it been restored to its traditional share of your overall fuel specialties business.
Ian Cleminson: I'm also wondering, you know, with another company I follow, they're noting kind of a decent adoption of the GDI engines and in certain regions, and just wondering if that is playing into some of the improved results on the margin line this quarter. Thank you. Sure.
Speaker Change: Also wondering with another company I follow their noting kind of a decent.
Adoption of the Gd I engines.
Speaker Change: And in certain regions and just wondering if that is playing into some of the improved results on the margin line. This quarter. Thank you sure I'll, let Ian take the front portion not in all of that to your comments.
Ian Cleminson: I'll let Ian take the front portion. Ian, I'll add to your comments. Sure, so yeah, we're really pleased. really good margin performance across all three regions in EMEA, the Americas and Asia Pacific, so it's not centred on any one region. The sales mix was certainly more favourable to us this quarter, year over year, but what we're seeing is good momentum across all product lines and we're really pleased with that. There's some new business coming through. Patrick talked a little bit earlier about how we'll win some business and we'll lose some. We're starting to see some GDI business coming through now which is nice sized and a really good start for us, so we've got a lot of expectations for this business to maintain the momentum through the remainder of the year and the team have done a great job and they're well positioned to execute against that.
Speaker Change: Sure. So yeah, we're really pleased with the fuel specialties business this quarter David.
Speaker Change: What we've seen is really good margin performance across all three regions.
Speaker Change: The Americas and Asia Pacific So, it's not censor them any one region. The sales mix was certainly more favorable to us this quarter year over year.
Speaker Change: But what we're saying is good momentum across all product lines.
Speaker Change: And we're really pleased with that.
Speaker Change: Yes, there is some new business coming through Patrick talks a little bit earlier about how we'll win some business in <unk>.
Speaker Change: Starting to see some GTI business going through right now which is nice.
Speaker Change: Nice sized in a really good start for us. So we've got a lot of expectations for this business to maintain the momentum through the remainder of the year and the team are doing a great job and they are well positioned to execute against that.
Ian Cleminson: No further comments, David, from me. That's okay. Very good.
David Silver: No further comments David.
Speaker Change: Okay very good.
David Silver: One other question would be kind of on the capital deployment, I guess, side of things. But you did get a $50 million authorization for share repurchase. You know, you did mention the $3.3 million of buybacks this quarter. But I think, you know, looking at the cash flow statement, there was even a little bit more activity than that.
Speaker Change:
Speaker Change: One other question would be kind of on the capital deployment, I guess side of things but.
Speaker Change: You did get a $50 million authorization on a ship for share repurchase you did mentioned the $3 3 billion million of buybacks this quarter, but I think looking at the cash flow statement, there was even a touch.
Speaker Change: A little bit more activity than that.
Ian Cleminson: Just, you know, big picture 2025 as a whole, is that buyback authorization or flexibility, is that likely to be used just to offset options-related issuance? Or might you say, you know, you're thinking of being a little more opportunistic in the current environment? Thank you. Yeah, good question. I think it's the second part of your answer. We're looking to be a little more opportunistic in this market. We've been continuing to buy back. We'll continue to buy back where we're sitting today. I think it's healthy for us. You know, when you talk about overall capital structure, we have the cash in place.
Speaker Change: Just you know.
Speaker Change: Big picture 2025, as a whole.
Speaker Change: Is that is that buyback.
Speaker Change: Authorization or flexibility is that likely to be used just to offset.
Speaker Change: Options related.
Speaker Change: Issuance or might you say.
Speaker Change: You're thinking of being a little more.
Speaker Change: Opportunistic in the current environment. Thank you.
Speaker Change: Yes, good question.
Speaker Change: I think it's the second part of your answer.
Speaker Change: Going to be a little more opt.
Speaker Change: Optimal opportunistic.
Speaker Change: In this market.
Speaker Change: We've been continuing to buyback will continue to buyback, where we're sitting today I think it's healthy for us.
Speaker Change: When you talked about overall capital structure, we have the cash in place.
Patrick Williams: to do multiple things, continue to grow our business organically, to look at M&A, to increase our dividend, which we just did, and to continue our buybacks. So, we're in a good position from a balance sheet standpoint, and I think that we're well balanced in what we're trying to accomplish. We just want to make sure that we've got some firepower for M&A if the right one comes along. There's still a little bit, and I'm sure the question's going to come, there's still a little bit of a disconnect between what the seller thinks is value versus what the buyer is willing to pay.
Speaker Change: To do multiple things continue to grow our business organically.
Speaker Change: To look at M&A to increase our dividend, which we just did.
Speaker Change: And to continue our buybacks. So we're in a good position from a balance sheet standpoint, and I think that we're well balanced in what we're trying to accomplish we just want to make sure that we've got some firepower for M&A.
Speaker Change: If the right. One comes along there is still a little bit and I'm sure. The question is going to come there's still a little bit of a disconnect between what the seller thinks is value versus what the buyer is willing to pay.
Patrick Williams: But we are seeing, you know, there is deal slowdown, but there are deals on the market that could potentially be a really good pickup for us if we can get it at the right price. But our balance sheet really gives us the flexibility to do all of those. Got it.
Speaker Change: But we are seeing there is deal slow down but there are deals on the market that are that that could potentially be a really good pickup for us if we can get it at the right price.
Speaker Change: But our balance sheet really gives us the flexibility to do all of those.
David Silver: Okay, great. That's it for me. Thank you very much. Thanks, Dan. Thank you.
Speaker Change: Got it.
Speaker Change: Okay, Great. That's it for me thank you very much.
Speaker Change: Thanks, Dan.
Operator: Dear speakers, there are no further questions for today.
Speaker Change: Dear speakers there are no further questions for today I would now like to hand the conference over.
Patrick Williams: I would now like to hand the conference over to Patrick Williams for any closing remarks. Thank you all for joining us today, and thanks to all our shareholders, customers, and Innospec employees for your interest and support. If you have any further questions about Innospec or matters discussed today, please give us a call.
Patrick Williams: To Patrick Williams for any closing remarks.
Patrick Williams: Thank you all for joining us today, and thanks to all our shareholders customers and inspect employees for your interest and support.
Patrick Williams: If you have any further questions about <unk> or matters discussed today. Please give us call. We look forward to meeting up with you again discuss our second quarter 2025 results in August have a great day.
Patrick Williams: We look forward to meeting up with you again to discuss our second quarter 2025 results in August. Have a great day.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.
Patrick Williams: This concludes today's conference call. Thank you for participating you may now disconnect have a nice day.
Patrick Williams: Okay.
Patrick Williams: [music].
Patrick Williams: Yeah.
Patrick Williams: Okay.
Patrick Williams: [music].