February 15, 2017 | Vincent Valk
Innospec today reported fourth quarter net income of $22.1 million, down 30% year-on-year (YOY), on sales down 3%, to $237.8 million. Adjusted earnings totaled $1.09/share, down 12% YOY, and ahead of analysts’ consensus estimate of 89 cts/share, as reported by Thomson Reuters (New York). Sales rose 4% YOY excluding the octane additives business, which is experiencing a long-term secular decline. Volumes grew across most of the company, with a strong bounceback in oilfield services.
Fuel specialties segment sales declined 3% YOY, to $142.5 million, while segment operating income was up 22%, to $38.4 million. Segment volumes grew 1%, but this was offset by lower prices and negative currency impacts.
Oilfield services segment sales grew 22% YOY, to $59.3 million, while the segment swung to a $2.4-million profit from a $4.8-million loss in the year-ago quarter. Volumes grew 53% YOY as the business has continued to bounce back from lows in the oil and gas market. Performance chemicals sales grew 4% YOY, to $31.9 million.
Innospec is “cautiously optimistic” about 2017, and “remains open to additional acquisitions that can further enhance our portfolio without over-stressing our balance sheet,” says president and CEO Patrick Williams.