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Dec 31, 2022
Innospec Q4 2022 Earnings Report
Innospec's Q4 2022 financial results were announced, featuring a 24% increase in revenue and strong operating income growth.
Key Takeaways
Innospec reported a strong fourth quarter with a 24% increase in revenue to $510.7 million and net income of $25.5 million. Adjusted non-GAAP EPS was $1.20. The company highlighted strong operating income growth and margin improvement.
Total revenues increased by 24% to $510.7 million compared to the previous year.
Net income was $25.5 million, or $1.02 per diluted share.
Adjusted non-GAAP EPS was $1.20 per diluted share.
Cash from operating activities was $78.4 million before capital expenditures.
Innospec
Innospec
Innospec Revenue by Segment
Revenue by Segment
Fuel Specialties Revenue
CapyFin.comOilfield Services Revenue
CapyFin.com Forward Guidance
Innospec anticipates technology-based organic growth opportunities across all businesses and expects to complete their $70 million Performance Chemicals expansion while continuing dividend growth and share repurchases.
Positive Outlook
- Expect technology-based organic growth opportunities across all businesses.
- Customers' drive towards cleaner formulations, lower carbon footprint and operational efficiency will help the company.
- Innovative chemistries and highly responsive technical service directly support customers’ priorities.
- Cash generation was excellent in the quarter, and net cash position strengthened to over $147 million.
- Debt-free balance sheet allows the company to continue to follow its growth strategy and enhance returns to shareholders.
Challenges Ahead
- General recessionary outlook for 2023.
- Destocking will continue to negatively impact volumes and margins into the first half of 2023.
- Full year adjusted effective tax rate was 27.0 percent compared to 22.7 percent last year.
- Increase in the tax rate in the year and specifically in the fourth quarter causing a 36 cents negative impact on earnings per share.
- A portion of production sales will moderate versus the extremely strong third and fourth quarters.
Revenue & Expenses
Visualization of income flow from segment revenue to net income