NewMarket Corporation (NYSE:NEU) Q2 2022 Results Earnings Conference Call August 3, 2022 3:00 PM ET

Company Participants

Brian Paliotti - Vice President and Chief Financial Officer

Conference Call Participants

Operator

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the NewMarket Corporation Conference Call and Webcast to Review Second Quarter 2022 Financial Results. At this time, all participants are in a listen-only mode.

I would now like to turn the call over to the host, Vice President and Chief Financial Officer, Brian Paliotti. Please go ahead.

Brian Paliotti

Thank you, Kelly. And thanks to everyone for joining me this afternoon. As a reminder, some of the statements made during this conference call may be forward-looking. Relevant factors that could cause actual results to differ materially from those forward-looking statements are contained in our earnings release and our SEC filings, including our most recent Form 10-K.

During this call, I may also discuss non GAAP financial measures included in our earnings release. The earnings release, which can be found out on our website, includes a reconciliation of the non-GAAP financial measure to the comparable GAAP financial measure.

We filed the 10-Q this morning. It contains significantly more details on the operations and performance of our company. Please take time to review it.

I will be referring to the data that was included in last night's earnings release. Net income of $66 million or $6.54 a share compared to net income of $52 million or $4.75 a share for the second quarter of last year.

Petroleum additives net sales for the second quarter of 2022 were a record $721 million compared to $586.6 million for the same period in 2021. Petroleum additives operating profit for the quarter was $91.2 million, higher than the second quarter operating profit last year of $74.2 million. The increase was mainly due to increased selling prices and shipments, partially offset by higher raw material and operating costs.

Shipments between quarterly periods were up 2.6%, with increases in lubricant additive shipments, partially offset by decreases in fuel additive shipments. And all regions except Latin America contributed to the increase in lubricant additive shipments. All regions except North America contributed to the decrease in fuel additive shipments.

Petroleum additives operating profit margin for the second quarter of 2022 was 12.7%. significantly lower than our historical average. Margin management will continue to be a priority in 2022 as we continue to see continuing upward pressure on all operating costs. In the past, cost increases have primarily been raw material related. But in the recent and current inflationary environment, many of the costs of goods sold inputs are significantly under pressure.