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Jun 30, 2020
Ingevity Q2 2020 Earnings Report
Ingevity delivered results in line with special, one-time second quarter guidance driven by cost reduction actions and strong execution.
Key Takeaways
Ingevity's Q2 2020 net sales were $270.6 million, a 23.3% decrease compared to the prior year quarter. Net income was $20.2 million, a 64.4% decrease, with diluted earnings per share at $0.49. The company reaffirmed its fiscal year 2020 guidance for sales and adjusted EBITDA.
Ingevity delivers results in line with special, one-time second quarter guidance driven by cost reduction actions and strong execution
Company reaffirms fiscal year 2020 guidance of sales between $1.10 billion and $1.20 billion and adjusted EBITDA between $310 million and $350 million
Cost reduction initiatives bolster second quarter profitability, and will save the company $35 million in 2020 and $12 million annually going forward
Net sales of $270.6 million were down 23.3% versus the prior year quarter as a result of weakened demand, particularly in the automotive industry, driven by the economic impacts of COVID-19
Revenue by Segment
Forward Guidance
Ingevity reaffirmed its fiscal year 2020 guidance of sales between $1.10 billion and $1.20 billion and adjusted EBITDA between $310 million and $350 million.
Positive Outlook
- Company reaffirms fiscal year 2020 guidance of sales between $1.10 billion and $1.20 billion
- Company reaffirms fiscal year 2020 guidance of adjusted EBITDA between $310 million and $350 million
- Pavement Technologies applications were about even with the prior year as paving in North America continued largely unaffected.
- Sales to pavement customers in the Europe, Middle East and Africa region (EMEA) increased
- Ingevity’s activated carbon pellet sales in China in the second quarter were the second highest on record reflecting the strong demand rebound and the implementation of the China 6 standard, which is essentially completed.
Challenges Ahead
- Net sales of $270.6 million were down 23.3% versus the prior year quarter as a result of weakened demand, particularly in the automotive industry, driven by the economic impacts of COVID-19
- Net income of $20.2 million decreased 64.4% and net income margin of 7.5% was down from 16.1% in the prior year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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