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NewMarket Corporation reported its third-quarter 2025 earnings, showcasing an earnings per share (EPS) of $10.67, surpassing analyst expectations. However, the company’s revenue of $690.31 million fell short of forecasts, reflecting challenges in its key segments. Following the earnings announcement, NewMarket’s stock experienced a 2.25% increase, closing at $747.90.
Key Takeaways
- NewMarket’s EPS exceeded expectations despite a decline in net income compared to the previous year.
- Revenue from petroleum additives and specialty materials decreased year-over-year.
- The company’s stock rose by 2.25% in after-hours trading.
- Strategic investments and acquisitions continue to shape NewMarket’s growth trajectory.
Company Performance
NewMarket’s performance in Q3 2025 was marked by a notable EPS beat, although revenue figures highlighted ongoing challenges. The company reported a net income of $100 million, down from $132 million in Q3 2024. This decline was attributed to reduced sales in petroleum additives and specialty materials, reflecting broader market softness and inflationary pressures. Despite these challenges, NewMarket’s strategic focus on technology and innovation remains strong, as evidenced by its recent acquisition of Calca Solutions, LLC.
Financial Highlights
- Revenue: $690.31 million, down from the previous year.
- Earnings per share: $10.67, above forecasts.
- Net income: $100 million, compared to $132 million in Q3 2024.
- Petroleum additives sales: $649 million, a decrease from $663 million in 2024.
- Specialty materials sales: $38 million, down from $59 million in 2024.
Earnings vs. Forecast
NewMarket’s EPS of $10.67 surpassed expectations, representing a positive surprise for investors. However, the company’s revenue of $690.31 million was below forecasts, underscoring challenges in its core segments. The EPS beat indicates effective cost management and strategic investments, despite a challenging economic environment.
Market Reaction
Following the earnings release, NewMarket’s stock rose by 2.25%, reflecting investor optimism about the company’s ability to navigate current challenges. The stock’s performance places it within its 52-week range, with a high of $875.97 and a low of $480. This positive movement aligns with a broader market trend favoring companies that demonstrate resilience and strategic foresight.
Outlook & Guidance
Looking ahead, NewMarket anticipates continued strength in its petroleum additives and specialty materials segments. The company has increased its quarterly dividend by 9% to $3 per share, signaling confidence in its long-term value creation strategy. NewMarket’s commitment to technology-driven growth and portfolio optimization is expected to bolster its competitive position.
Executive Commentary
Tim Fitzgerald, CFO, emphasized NewMarket’s dedication to long-term value creation, stating, "We are committed to making decisions that promote long-term value for our shareholders and customers." He also highlighted the company’s focus on technology investments to meet evolving customer needs, reinforcing NewMarket’s strategic direction.
Risks and Challenges
- Inflationary pressures and tariffs continue to pose risks to profitability.
- Market softness may impact shipment volumes in the near term.
- Volatility in the specialty materials segment could affect financial performance.
- Ongoing global economic uncertainties may influence demand patterns.
Q&A
While the earnings call did not detail a specific Q&A session, NewMarket remains open to addressing questions via email or phone, reflecting its commitment to transparency and stakeholder engagement.
Full transcript - NewMarket Corp (NEU) Q3 2025:
Conference Call Moderator: Good day, everyone, and welcome to the NewMarket Corporation conference call and webcast to review third quarter 2025 financial results. At this time, all participants are placed on a listen-only mode. It is now my pleasure to turn the floor over to your host, Tim Fitzgerald, Vice President and CFO. Sir, the floor is yours.
Tim Fitzgerald, Vice President and CFO, NewMarket Corporation: Thank you, Matthew, 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 in our SEC filings, including our most recent Form 10-K. During this call, we will also discuss the non-GAAP financial measures included in our earnings release. The earnings release, which can be found on our website, includes a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. We filed our 10-Q for the third quarter of 2025 earlier today, and it contains significantly more details on the operations and performance of our company. Today, I will be referring to the data that was included in last night’s press release.
Net income for the third quarter of 2025 was $100 million, or $10.67 per share, compared to net income of $132 million, or $13.79 per share, for the third quarter of 2024. Net income for the first nine months of 2025 was $337 million, or $35.78 per share, compared to net income of $352 million, or $36.66 per share, for the first nine months of 2024. Petroleum additive sales for the third quarter of 2025 were $649 million, compared to $663 million for the same period in 2024. Petroleum additive operating profit for the third quarter of 2025 was $131 million, compared to $157 million for the third quarter of 2024, which was a record quarter for this segment.
The decrease in operating profit compared to the prior year was primarily driven by one-time charges during the quarter, including those related to optimizing our global manufacturing network, which will enable us to deliver products to our customers more efficiently in the years ahead. A 4.1% decline in shipments between quarterly periods and an increase in R&D investments to support our customer needs also contributed to the decrease in petroleum additive operating profit. For the first nine months of 2025, sales for the petroleum additive segment were $1.9 billion, compared to $2 billion for the same period in 2024. Petroleum additive operating profit for the first nine months of 2025 was $413 million, compared to $456 million for the same period in 2024. The drivers for the decrease in operating profit were consistent with those affecting the third quarter comparison.
Shipments were down by 4.6% when comparing the first nine months of 2025 with the same period in 2024, driven by softness in the market and our strategic decision to manage the profitability of our portfolio by reducing low-margin business. We are very pleased with the performance of our petroleum additives business during the first nine months of 2025. However, we remain challenged by the ongoing inflationary environment and the impact of tariffs, as well as softness in the market impacting shipments. We continue to focus on investing in technology to meet customer needs, optimizing our inventory levels, and improving our portfolio profitability. We report the financial results of our AMPAC business in our specialty materials segment. Specialty materials sales for the third quarter of 2025 were $38 million, compared to $59 million for the same period in 2024.
Specialty materials operating profit for the third quarter of 2025 was $6 million, compared to $16 million for the third quarter of 2024. The decrease in operating profit was mainly due to lower volume within the quarter. As previously stated, we will see substantial variation in quarterly results for the specialty materials segment on an ongoing basis due to the nature of the business. For the first nine months of 2025, sales for the specialty materials segment were $134 million, compared to $114 million for the period of January 16th to September 30th, 2024. Specialty materials operating profit for the first nine months of 2025 was $40 million, compared to $16 million for the period of January 16th to September 30th, 2024. As previously announced, we expanded our investment in the specialty materials segment through the October 1st, 2025, acquisition of Calca Solutions, LLC.
Calca is the nation’s leading producer of ultra-pure hydrazine propellants used in advanced aerospace and defense applications. Since 2024, through our acquisitions of AMPAC and Calca and our investments to expand capacity at both operations, we have committed approximately $1 billion to this resilient, high-technology specialty materials segment. Our company generated solid cash flows throughout the first nine months of 2025, which allowed us to return $155 million to our shareholders through share repurchases of $77 million and dividends of $78 million. We also reduced our net debt by $213 million in the first nine months of 2025, driving our net debt-to-EBITDA ratio down to 0.9 times as of September 30, 2025. This strong cash flow performance enables us to continue to provide value to our shareholders through reinvestment of capital into our businesses for growth and efficiency, acquisitions, share repurchases, and dividends.
Yesterday, the company’s Board of Directors approved raising the quarterly dividend by 9%, up from $2.75 per share on our common stock to $3 per share for the dividend that is payable January 2, 2026. We anticipate continued strength in our petroleum additives and specialty materials segments. We are committed to making decisions that promote long-term value for our shareholders and customers while staying focused on our long-term objectives. We believe that the core principles guiding our business—a long-term perspective, a safety-first culture, customer-focused solutions, technology-driven products, and a world-class supply chain—will continue to benefit all of our stakeholders. Matthew, that concludes our planned comments. We are available for questions via email or by phone, so please feel free to contact me directly. Thank you all again, and we will talk to you next quarter.
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