Petroleum additives operating profit for the fourth quarter of this year was $59.3 million, which was down 18 percent compared to fourth quarter 2010 operating profit of $72.0 million. Sales for the fourth quarter increased to $499 million which was 10 percent higher than sales for the fourth quarter last year even though shipments were down 2 percent. We believe that the decline in shipments and operating profits in the fourth quarter include the effect of reduction of inventory levels by some of our customers, as well as some slowdown in demand influenced by economic issues around the world, predominately in Europe. We also incurred several significant one-time costs in the quarter.
We believe that, despite a softening of demand in Europe and an uncertain world economy, worldwide demand for additives will continue to grow at a 1-2% per annum rate. We remain confident in our ability to continue to exceed this industry growth rate.
The cash flow from our operating performance this year enabled us to repurchase 659,373 shares of our common stock for $94.8 million, increase our dividend from 44 cents per share last January to its current level of 75 cents per share and spend a record $105.5 million in research and development for the year while increasing our revolving debt by only $18 million. We continue to emphasize the use of our strong cash flows on strengthening our business operations and enhancing shareholder value.
The year 2011 was another year of growth and achievements. Both 2011 and future year operations are solidly based on a strategy of delivering the goods and services our customers need to succeed in their marketplace. I want to thank our customers for their continued support and thank our employees for their dedication to meeting our customers’ needs and maintaining a safe working environment in our operations around the world.
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