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Innospec Reports Fourth Quarter And Full Year 2013 Financial Results

Stocks in this article: IOSP

Fourth quarter adjusted non-GAAP diluted EPS of $1.06 exceeds analyst expectations

Record sales for the year and gross profit improvement in Fuel Specialties and Performance Chemicals

Strong cash flow, healthy balance sheet, acquisitions contribute to top and bottom-line growth

ENGLEWOOD, Colo., Feb. 12, 2014 (GLOBE NEWSWIRE) -- Innospec, Inc. (Nasdaq:IOSP) today announced its financial results for the fourth quarter and full year ended December 31, 2013.

Total net sales for the fourth quarter were a record $241.6 million, a 13 percent increase from $213.7 million in the corresponding period last year. Net income was $28.7 million, or $1.17 per diluted share, compared with $11.3 million, or $0.47 per diluted share, a year ago. EBITDA (earnings before taxes, depreciation, amortization and impairment) for the quarter was $38.7 million, a 35 percent increase from $28.6 million posted in 2012's fourth quarter.

Results for the fourth quarter include some special items, which are summarized in the table below. Excluding these special items, adjusted non-GAAP EPS for the fourth quarter was $1.06, an increase from $0.83 a year ago, exceeding consensus analyst expectations. Innospec closed the quarter in a net debt position of $61.2 million as an additional $54.0 million of revolving credit facility was drawn down in order to fund the acquisition of Bachman Services Inc. and a $12.0 million dividend payment of $0.50 per common share.

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 December 31, 2013 Quarter ended December 31, 2012
(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  $ 30.7  $ 28.7  $ 1.17  $ 24.8  $ 11.3  $ 0.47
Foreign currency exchange gains (4.9) (4.1) (0.17) (1.3) (1.0) (0.04)
75 th anniversary employee recognition 1.6 1.3 0.05 -- -- --
Acquisition-related costs 0.3 0.2 0.01 2.5 2.0 0.08
Adjustment of income tax provisions 0.1 0.1 -- 0.3 0.3 0.01
Tax impact of acquisition-related funding -- -- -- 7.4 7.4 0.31
  (2.9) (2.5) (0.11) 8.9 8.7 0.36
Adjusted non-GAAP amounts  $ 27.8  $ 26.2  $ 1.06  $ 33.7  $ 20.0  $ 0.83

Commenting on the results, Patrick Williams, President and Chief Executive Officer, said, "We had a record fourth quarter sales, with a strong contribution from acquisitions, while our core businesses performed as we expected throughout the year. Importantly, all the acquisitions we made during the year are contributing positively, both to our top and bottom lines, and integration of these businesses into the Innospec family has been going quite smoothly. Today, Innospec is a decidedly larger organization in terms of both headcount and footprint in the markets we serve. We finished the year stronger, with good momentum, and we believe we are well positioned for 2014 in our core markets which are growing, profitable and responsive to new technology.

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