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Innospec (IOSP) Q1 Earnings Top Estimates, Sales Up Y/Y
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Innospec Inc. (IOSP - Free Report) posted a profit of $17.2 million or 70 cents per share in first-quarter 2017, down around 9% from $18.9 million or 77 cents per share a year ago.
Barring one-time items, earnings were $1.00 per share for the quarter, coming ahead of the Zacks Consensus Estimate of 95 cents.
The chemical maker’s revenues soared 39% year over year to $294.3 million in the quarter. The company saw higher sales across core business segments in the reported quarter.
Revenues from the Fuel Specialties segment went up 2% year over year to $126.4 million in the quarter as higher volumes offset unfavorable price and mix and negative currency impact. Operating income rose 12% to $26.8 million in the quarter.
The Performance Chemicals unit raked in sales of $94.5 million in the quarter, a nearly three-fold year over year jump, driven by recent acquisition. Operating income climbed 36% to $6 million.
Revenues from the Oilfield Services division surged 84% to $66.5 million, buoyed by increased customer activity. Higher volumes also more than offset price and mix reduction. The segment returned to an operating income of $3 million in the quarter, from a loss of $5.5 million a year ago. The division is benefiting from the industry recovery.
Revenues from the Octane Additives unit tumbled roughly 61% year over year to $6.9 million. Operating income slid around 82% to $2 million.
Balance Sheet
Innospec ended the quarter with cash and cash equivalents of $45.4 million, down around 60% year over year. Total debt was $243.7 million, up around 56% year over year. Net cash used in operations was $19.9 million in the quarter versus cash generated of $6.7 million a year ago.
The company also hiked its semi-annual dividend by 15% to 38 cents per common share for first-half 2017. The dividend will be paid on May 31, 2017, to shareholders of record as of May 22, 2017.
Outlook
Innospec said that it is well positioned to deliver strong growth in all of its businesses moving ahead. The company will continue to fully integrate its recent acquisition while remaining open to more acquisition opportunities that would further bolster its portfolio.
Price Performance
Innospec has outperformed the Zacks categorized Chemicals-Diversified industry over a year. The company’s shares have rallied around 34.7% over this period compared with the industry’s gain of 17.9% over the same period.
Chemours has an expected long-term growth of 15.5%.
Kronos has an expected long-term growth of 5%.
Methanex has an expected long-term growth of 15%.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>
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Innospec (IOSP) Q1 Earnings Top Estimates, Sales Up Y/Y
Innospec Inc. (IOSP - Free Report) posted a profit of $17.2 million or 70 cents per share in first-quarter 2017, down around 9% from $18.9 million or 77 cents per share a year ago.
Barring one-time items, earnings were $1.00 per share for the quarter, coming ahead of the Zacks Consensus Estimate of 95 cents.
The chemical maker’s revenues soared 39% year over year to $294.3 million in the quarter. The company saw higher sales across core business segments in the reported quarter.
Innospec Inc. Price, Consensus and EPS Surprise
Innospec Inc. Price, Consensus and EPS Surprise | Innospec Inc. Quote
Segment Highlights
Revenues from the Fuel Specialties segment went up 2% year over year to $126.4 million in the quarter as higher volumes offset unfavorable price and mix and negative currency impact. Operating income rose 12% to $26.8 million in the quarter.
The Performance Chemicals unit raked in sales of $94.5 million in the quarter, a nearly three-fold year over year jump, driven by recent acquisition. Operating income climbed 36% to $6 million.
Revenues from the Oilfield Services division surged 84% to $66.5 million, buoyed by increased customer activity. Higher volumes also more than offset price and mix reduction. The segment returned to an operating income of $3 million in the quarter, from a loss of $5.5 million a year ago. The division is benefiting from the industry recovery.
Revenues from the Octane Additives unit tumbled roughly 61% year over year to $6.9 million. Operating income slid around 82% to $2 million.
Balance Sheet
Innospec ended the quarter with cash and cash equivalents of $45.4 million, down around 60% year over year. Total debt was $243.7 million, up around 56% year over year. Net cash used in operations was $19.9 million in the quarter versus cash generated of $6.7 million a year ago.
The company also hiked its semi-annual dividend by 15% to 38 cents per common share for first-half 2017. The dividend will be paid on May 31, 2017, to shareholders of record as of May 22, 2017.
Outlook
Innospec said that it is well positioned to deliver strong growth in all of its businesses moving ahead. The company will continue to fully integrate its recent acquisition while remaining open to more acquisition opportunities that would further bolster its portfolio.
Price Performance
Innospec has outperformed the Zacks categorized Chemicals-Diversified industry over a year. The company’s shares have rallied around 34.7% over this period compared with the industry’s gain of 17.9% over the same period.
Zacks Rank & Key Picks
Innospec is a Zacks Rank #3 (Hold) stock.
Better-ranked companies in the chemical space include The Chemours Company (CC - Free Report) , Kronos Worldwide, Inc. (KRO - Free Report) and Methanex Corporation (MEOH - Free Report) , all holding a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Chemours has an expected long-term growth of 15.5%.
Kronos has an expected long-term growth of 5%.
Methanex has an expected long-term growth of 15%.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>