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Mar 31, 2020
Innospec Q1 2020 Earnings Report
Innospec reported a decrease in net sales but an increase in net income and adjusted EPS for Q1 2020, while adapting to economic challenges.
Key Takeaways
Innospec's Q1 2020 results showed a 4% decrease in net sales to $372.3 million, but net income increased to $33.1 million, or $1.34 per diluted share. Adjusted non-GAAP EPS rose by 14% to $1.42. The company maintained liquidity with positive operating cash flow and held its semi-annual dividend at $0.52 per share.
Net sales decreased by 4% to $372.3 million compared to Q1 2019.
Net income increased to $33.1 million, or $1.34 per diluted share, up from $28.7 million, or $1.17 per diluted share, in the previous year.
Adjusted non-GAAP EPS increased by 14% to $1.42 per diluted share.
EBITDA increased by 10% to $56.7 million compared to $51.7 million in Q1 2019.
Innospec
Innospec
Innospec Revenue by Segment
Revenue by Segment
Performance Chemicals Revenue
CapyFin.comFuel Specialties Revenue
CapyFin.comOilfield Services Revenue
CapyFin.com Forward Guidance
Innospec anticipates potential short-term issues in Performance Chemicals but expects long-term sustainable growth. Fuel Specialties prospects depend on fuel demand, with potential short-term issues but expected rebound. Oilfield Services faces challenges due to reduced demand and increased supply in the oil and gas industry.
Positive Outlook
- Maintaining safe operation of plants.
- Continuing to supply customers.
- Strong balance sheet with net cash.
- Maintaining dividend at the same level as the second half of 2019.
- Potential for further organic growth projects and strategic acquisitions.
Challenges Ahead
- Short-term issues during lockdown periods for Performance Chemicals.
- Substantial issues in the short-term where trucking is impacted by reduced movement of goods for Fuel Specialties.
- Massive impact on the oil and gas industry affecting Oilfield Services.
- Reduction in customer activity in Oilfield Services.
- Dependence on improvement in crude oil prices for Oilfield Services.
Revenue & Expenses
Visualization of income flow from segment revenue to net income