Loading...
•
Jun 30, 2020
Valvoline Q3 2020 Earnings Report
Valvoline's third-quarter results reflected a sales decline of 16% to $516 million, but showed sequential improvement throughout the quarter, with a 10% growth in June. Net income decreased by 9% to $59 million, and EPS decreased by 6% to $0.32.
Key Takeaways
Valvoline's Q3 2020 results demonstrated resilience with a sales decline of 16% to $516 million, but a strong recovery in June with 10% growth. Net income decreased by 9% to $59 million, and EPS decreased by 6% to $0.32. The company benefited from easing COVID-19 restrictions and strong in-store execution.
Sales declined 16% to $516 million, but improved sequentially, with 10% growth in June.
Quick Lubes system-wide same-store sales decreased 8.0% for the quarter but grew 7.1% in June.
Net income decreased 9% to $59 million, and EPS decreased 6% to $0.32.
Cash flow from operations increased $37 million, and free cash flow increased $25 million from the prior year.
Valvoline
Valvoline
Forward Guidance
Valvoline anticipates same-store sales growth to be in the high-single digits for Q4 and expects FY20 adjusted EBITDA to be in the range of $475 million to $485 million.
Positive Outlook
- Strong recovery across segments during Q3.
- July results show same-store sales growth ahead of June levels.
- Anticipate same-store sales growth in the high-single digits for Q4.
- Expect 14th straight year of same store sales growth.
- FY20 adjusted EBITDA expected to be in the range of $475 million to $485 million.
Challenges Ahead
- Uncertainty related to COVID-19 remains.
- Guidance could be impacted by future external events related to COVID-19.
- Additional state, regional, or country lockdown measures could impact results.
- Significant changes in driving trends could impact results.
- Unable to reconcile adjusted EBITDA to GAAP net income for fiscal 2020 without unreasonable efforts.