NASDAQ$IOSP

Innospec Inc · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

Innospec's Q4 2022 financial results were announced, featuring a 24% increase in revenue and strong operating income growth.

Innospec reported a strong fourth quarter with a 24% increase in revenue to $510.7 million and net income of $25.5 million. Adjusted non-GAAP EPS was $1.20. The company highlighted strong operating income growth and margin improvement.

  • Total revenues increased by 24% to $510.7 million compared to the previous year.
  • Net income was $25.5 million, or $1.02 per diluted share.
  • Adjusted non-GAAP EPS was $1.20 per diluted share.
  • Cash from operating activities was $78.4 million before capital expenditures.

Headline financials

Total Revenue

$511M

Previous: $413M+23.6%
EPS (adj)

$1.20

Previous: $1.30-7.7%
Cash from Operations

$78.4M

Previous: $68.8M+14.0%
Net Income

$25.5M

Previous: $23.9M+6.7%
Operating Income

$46.6M

Previous: $35.5M+31.3%
Gross Profit

$152M

Previous: $113M+34.3%
Cash & Equivalents

$147M

Previous: $142M+3.7%
Total Assets

$1.6B

Previous: $1.57B+2.1%
Stock-Based Comp

$2M

Previous: -$200K+1100.0%

Revenue & EPS history

Innospec · Revenue · Quarterly

$511M

Q4 2022+23.6%vs Q4 2021
Beat estimate in 7 of 15 quarters(47%)
ActualEstimate

Revenue by segment

Innospec · $367M total across 2 segments · Q4 2022

  • Oilfield Services
    $184M+92.5%
  • Fuel Specialties
    $183M+2.1%

Forward guidance

Innospec anticipates technology-based organic growth opportunities across all businesses and expects to complete their $70 million Performance Chemicals expansion while continuing dividend growth and share repurchases.

Tailwinds

  • Expect technology-based organic growth opportunities across all businesses.
  • Customers' drive towards cleaner formulations, lower carbon footprint and operational efficiency will help the company.
  • Innovative chemistries and highly responsive technical service directly support customers’ priorities.
  • Cash generation was excellent in the quarter, and net cash position strengthened to over $147 million.
  • Debt-free balance sheet allows the company to continue to follow its growth strategy and enhance returns to shareholders.

Headwinds

  • General recessionary outlook for 2023.
  • Destocking will continue to negatively impact volumes and margins into the first half of 2023.
  • Full year adjusted effective tax rate was 27.0 percent compared to 22.7 percent last year.
  • Increase in the tax rate in the year and specifically in the fourth quarter causing a 36 cents negative impact on earnings per share.
  • A portion of production sales will moderate versus the extremely strong third and fourth quarters.

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 Q4 2022

Historical avgQ4 2022

+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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