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Innospec Reports Second Quarter 2012 Financial Results

Stocks in this article: IOSP

Adjusted Non-GAAP Diluted EPS of $0.79, in Line with Consensus;

Gross Margin Steady at 31.8%; Solid Sales Performance Against Soft Economies;

Continued Strong Cash Flows and Balance Sheet Strength

LITTLETON, Colo., Aug. 8, 2012 (GLOBE NEWSWIRE) -- Innospec Inc. (Nasdaq:IOSP) today announced its financial results for the second quarter ended June 30, 2012.

Total net sales for the second quarter were $178.5 million, a 4 percent decrease from $186.5 million in the corresponding quarter last year. Net income was $15.5 million, or $0.65 per diluted share, compared to $24.6 million, or $1.00 per diluted share, recorded a year ago. EBITDA (earnings before interest, taxes, depreciation, amortization and impairment) for the quarter was $22.8 million, down from $34.2 million posted a year ago. The quarter-over-quarter decrease in reported net income and EBITDA was primarily due to a pre-tax $12.2 million swing in foreign currency exchange gains and losses.

Results for the second quarter include after-tax foreign currency exchange losses of $3.4 million, or $0.14 per diluted share; a year ago, special items had a combined positive impact of $3.9 million, or $0.15 per diluted share. Excluding these items, adjusted non-GAAP EPS was $0.79 per diluted share, a decrease from $0.85 a year ago, but in line with consensus analyst expectations for the quarter. Cash generation for the quarter was strong, with operating cash inflows of $12.3 million. Capital expenditure during the quarter was $2.6 million. Net cash stood at $70.5 million at the end of the quarter.

EBITDA and net income excluding special items, and related per-share amounts, are non-GAAP financial measures that are defined and reconciled with GAAP results herein and in the schedules below.  

  Quarter ended June 30, 2012 Quarter ended June 30, 2011  
(in millions, except share and per share data) Income before income taxes Net income Diluted EPS Income before income taxes Net income Diluted EPS  
               
Reported GAAP amounts  $ 19.5 $ 15.5 $ 0.65 $ 29.5 $ 24.6 $ 1.00  
               
Foreign currency exchange losses/(gains) 4.3 3.4 0.14 (7.9) (6.3) (0.25)  
Civil complaint legal and professional expenses -- -- -- 3.0 2.4 0.10  
  4.3 3.4 0.14 (4.9) (3.9) (0.15)  
               
Adjusted non-GAAP amounts $ 23.8 $ 18.9 $ 0.79 $ 24.6 $ 20.7 $ 0.85  

For the first six months of 2012, total net sales of $379.3 million increased 2% from $371.8 million in the corresponding period last year. Net income for the first half was $40.1 million, or $1.68 per diluted share, down from $46.1 million, or $1.88 per diluted share, a year ago. Excluding special items, diluted earnings per share for the first six months of 2012 were $1.79, a 13% increase from $1.59 a year ago. EBITDA for the first half of 2012 was $58.0 million, compared with $67.7 million in last year's first half.

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