NASDAQ$IOSP

Innospec Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Innospec's Q3 2020 financial results were announced, showing sequential improvement across business units and regions. The company demonstrated excellent cash generation and maintained its semi-annual dividend.

Innospec reported Q3 2020 financial results with net sales of $265.1 million and a net income of $12.7 million, or $0.51 per share. Adjusted non-GAAP EPS was $0.71. The company generated $55.5 million in cash from operating activities and closed the quarter with a net cash position of $66.0 million.

  • Performance Chemicals operating income increased by 33% due to strong demand.
  • Fuel Specialties and Oilfield Services showed sequential improvement.
  • The company reported excellent cash generation, improving net cash to $66.0 million.
  • The semi-annual dividend was maintained at $0.52.

Headline financials

Total Revenue

$265M

Previous: $372M-28.7%
EPS (adj)

$0.71

Previous: $1.40-49.3%
Adjusted EBITDA

$31.5M

Previous: $51.1M-38.4%
Capital Expenditures

-$21.7M

Previous: -$22.6M+4.0%
Free Cash Flow

-$9M

Previous: $7.5M-220.0%
Net Income

$12.7M

Previous: $30.1M-57.8%
Operating Income

$16.8M

Previous: $38.2M-56.0%
Gross Profit

$78.7M

Previous: $119M-33.9%
Cash & Equivalents

$66.6M

Previous: $110M-39.6%
Total Assets

$1.34B

Previous: $1.49B-10.1%
Stock-Based Comp

$1.6M

Previous: $1.7M-5.9%

Revenue & EPS history

Innospec · Revenue · Quarterly

$265M

Q3 2020-28.7%vs Q3 2019
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

Innospec · $163M total across 2 segments · Q3 2020

  • Fuel Specialties
    $120M-16.7%
  • Oilfield Services
    $43.1M-64.5%

Forward guidance

Innospec remains focused on helping customers innovate the next generation of products. They plan to continue investing in global capacity for Performance Chemicals, maintain technology leadership in Fuel Specialties, and focus on technology-driven organic growth in Oilfield Services.

Tailwinds

  • Continue to invest in global capacity to produce leading mild and natural home and personal care products.
  • Advance position in the agricultural, mining and construction end-markets.
  • Maintain technology leadership in additives that reduce emissions and improve efficiency.
  • Extend technology into applications such as fuel efficient gasoline direct injection engines and low sulfur marine fuels.
  • Solutions for completion and production are well suited to help E&P customers achieve their post crisis development objectives.

Headwinds

  • Recovery in some businesses has been slower than hoped.
  • Automotive, trucking, and aviation fuel demand are still below 2019 levels.
  • Oilfield Services sales have been the most severely impacted.
  • Customer preferences for natural and environmentally friendly products have further strengthened since the onset of the pandemic.
  • Focus on technology driven organic growth

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

+1.5%

Avg return

Earnings day

+1.1%

Avg return

5 days after

+0.5%

Avg return

30 days after

62%

40 / 65 earnings

Positive

+14.7%

Q3 2024

Best reaction

-8.5%

Q2 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+3.2%-0.8%+1.0%
Q4 2025-0.0%-8.3%-23.5%
Q3 2025+2.4%+3.9%+3.8%
Q1 2025-3.2%-6.0%-7.8%
Q4 2024-7.0%-7.2%-12.6%
Q3 2024+14.7%+11.7%+7.6%
Q2 2024-8.5%-8.2%-6.6%
Q1 2024+4.9%+5.0%+0.9%
Q4 2023-0.5%+3.0%+1.5%
Q3 2023+0.7%+0.8%+9.8%
Q2 2023+0.5%+1.3%-2.3%
Q1 2023+0.6%-1.3%-0.1%
Q4 2022-5.6%-5.1%-14.0%
Q3 2022-1.1%+5.8%+6.8%
Q2 2022-4.2%-7.6%-12.1%
Q1 2022+4.4%+5.4%+10.6%
Q4 2021+8.1%+8.4%+3.5%
Q3 2021+2.2%+3.3%-7.6%
Q2 2021-2.5%+1.0%+4.4%
Q1 2021+1.6%+4.2%+3.5%
Q4 2020-2.4%-0.2%+4.8%
Q3 2020+2.4%+0.6%+23.4%
Q2 2020-0.2%+2.9%-4.1%
Q1 2020+2.3%+5.2%+16.5%
Q4 2019-0.2%-8.4%-37.7%
Q3 2019+9.2%+8.8%+8.9%
Q2 2019+0.8%+2.2%+0.9%
Q1 2019+0.4%-0.3%-2.5%
Q4 2018+5.8%+9.6%+12.3%
Q3 2018+9.9%+8.3%-2.1%
Q2 2018-3.3%-4.5%-2.0%
Q1 2018+2.8%+3.4%+9.9%
Q4 2017+0.8%+2.6%+4.5%
Q3 2017+9.7%+3.6%+10.2%
Q2 2017-4.7%-9.3%-13.3%
Q1 2017-0.8%-2.6%+3.8%
Q4 2016+5.7%+1.9%-9.8%
Q3 2016-6.7%-5.5%+10.2%
Q2 2016+6.6%+16.1%+17.1%
Q1 2016+0.1%
Q4 2015-7.9%
Q3 2015+4.1%
Q2 2015+4.3%
Q1 2015-0.1%
Q4 2014+3.7%
Q3 2014+8.0%
Q2 2014+2.3%
Q1 2014-1.4%
Q4 2013+5.4%
Q3 2013-2.6%
Q2 2013+0.4%
Q1 2013-3.6%
Q4 2012+0.2%
Q3 2012+4.9%
Q4 2011-3.0%
Q2 2012-4.6%
Q1 2011+7.5%
Q1 2012+8.5%
Q4 2009-2.5%
Q3 2010-2.5%
Q3 2011+7.4%
Q2 2011+4.4%
Q2 2010+4.4%
Q4 2010+4.4%
Q1 2010+7.8%

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