Ingevity Corp (NGVT) Reports Q3 2023 Earnings: Net Sales Down 7%, Net Income at $25.2 Million
Net sales for Q3 2023 stood at $446.0 million, a decrease of 7% compared to the previous year.
Net income for the quarter was $25.2 million, with diluted earnings per share (EPS) of $0.69.
Adjusted EBITDA for the quarter was $110.4 million, with an adjusted EBITDA margin of 24.8%.
Ingevity Corp (NYSE:NGVT) announced restructuring measures for its Performance Chemicals segment, including the closure of its DeRidder, Louisiana, facility.
Released on November 1, 2023, Ingevity Corp (NYSE:NGVT)'s Q3 2023 earnings report shows a decline in net sales and net income compared to the previous year. The company reported net sales of $446.0 million, a decrease of 7% from the record prior year. Net income stood at $25.2 million, with diluted earnings per share (EPS) of $0.69. Adjusted EBITDA was $110.4 million, with an adjusted EBITDA margin of 24.8%.
Performance Highlights and Challenges
The decline in net sales was attributed to lower volumes due to weak industrial demand, primarily impacting Advanced Polymer Technologies and the Industrial Specialties business line. This was partially offset by improved North America and Asia sales in Performance Materials and increased pricing in the Pavement Technologies business line. The decrease in net income and diluted EPS was due to lower operating earnings, restructuring and other charges recorded during the quarter, and higher interest expense associated with the Ozark acquisition.
Segment Performance
Sales in Performance Chemicals were $256.0 million, down 4% from the prior year. Industrial Specialties posted sales of $126.3 million, down 30%, due to lower volumes attributed primarily to weak demand across end markets, particularly for rosin-based products. Sales in Advanced Polymer Technologies (APT) were down 38% to $42.8 million due to market weakness across the segments end markets in all regions. Sales in Performance Materials were $147.2 million in the quarter, up 2% as increased automotive carbon demand, particularly in Asia Pacific and North America, offset volume declines of lower margin, non-automotive carbon.
Future Outlook
Ingevity Corp (NYSE:NGVT) has revised its full-year adjusted EBITDA guidance to between $375 million and $390 million, citing weak industrial demand and rising CTO costs. The company also announced actions to accelerate the repositioning of its Performance Chemicals segment, including the closure of its DeRidder, Louisiana, facility and company-wide restructuring.
Explore the complete 8-K earnings release (here) from Ingevity Corp for further details.
This article first appeared on GuruFocus.
