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Dec 31, 2020
Ingevity Q4 2020 Earnings Report
Delivered strong fourth quarter results driven by continued recovery of global automotive production, an increase in demand for engineered polymers, and ongoing global paving activity.
Key Takeaways
Ingevity reported a 7.3% increase in net sales to $325.6 million and a 14.7% increase in net income to $50.8 million for the fourth quarter of 2020. Strong automotive production and sales in China and a favorable shift to trucks and SUVs in the U.S. and Canada were significant tailwinds. The company's adjusted EBITDA margin rose to a fourth quarter record.
Net sales of $325.6 million were up 7.3%.
Net income of $50.8 million was up 14.7%; net income margin was 15.6%, up 100 basis points.
Adjusted EBITDA of $110.9 million were up 21.7%; adjusted EBITDA margin of 34.1%, up 410 basis points.
Operating cash flow of $153.3 million up 79.3%; free cash flow of $122.2 million up 142.0%
Revenue by Segment
Forward Guidance
Ingevity announced its fiscal year 2021 guidance to sales between $1.25 billion and $1.30 billion and adjusted EBITDA between $400 million and $420 million. Free cash flow will be at or above $200 million.
Positive Outlook
- Anticipate moderate growth in demand for pavement technologies
- Anticipate moderate growth in demand for engineered polymers based on strong paving project backlog
- Anticipate moderate growth in demand for continued Evotherm® warm mix technology adoption
- Anticipate moderate growth in demand for increased demand for thermoplastics
- Expect increased demand for merchant rosin
Challenges Ahead
- Expect continued demand weakness in oilfield technologies.
- EBITDA margins will likely return to more historical levels as the industry returns to a more normalized production pace.
- Economic pressure from COVID-19
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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