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Share Name | Share Symbol | Market | Type |
---|---|---|---|
NewMarket Corporation | NYSE:NEU | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-4.18 | -0.78% | 529.41 | 540.16 | 526.72 | 533.59 | 65,326 | 00:17:56 |
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Virginia
|
|
20-0812170
|
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
|
330 South Fourth Street
|
|
23219-4350
|
|
Richmond,
|
Virginia
|
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, without par value
|
NEU
|
New York Stock Exchange
|
Large accelerated filer
|
x
|
|
Accelerated filer
|
¨
|
Non-accelerated filer
|
¨
|
|
Smaller reporting company
|
☐
|
|
|
|
Emerging growth company
|
☐
|
|
Page
Number
|
|
|
|
|
|
|
(in thousands, except per-share amounts)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Net sales
|
|
$
|
559,417
|
|
|
$
|
536,616
|
|
Cost of goods sold
|
|
378,510
|
|
|
383,747
|
|
||
Gross profit
|
|
180,907
|
|
|
152,869
|
|
||
Selling, general, and administrative expenses
|
|
35,715
|
|
|
36,773
|
|
||
Research, development, and testing expenses
|
|
35,506
|
|
|
33,224
|
|
||
Operating profit
|
|
109,686
|
|
|
82,872
|
|
||
Interest and financing expenses, net
|
|
7,104
|
|
|
8,012
|
|
||
Other income (expense), net
|
|
7,496
|
|
|
5,948
|
|
||
Income before income tax expense
|
|
110,078
|
|
|
80,808
|
|
||
Income tax expense
|
|
24,537
|
|
|
18,603
|
|
||
Net income
|
|
$
|
85,541
|
|
|
$
|
62,205
|
|
Earnings per share - basic and diluted
|
|
$
|
7.67
|
|
|
$
|
5.57
|
|
Cash dividends declared per share
|
|
$
|
1.90
|
|
|
$
|
1.75
|
|
(in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Net income
|
|
$
|
85,541
|
|
|
$
|
62,205
|
|
Other comprehensive income (loss):
|
|
|
|
|
||||
Pension plans and other postretirement benefits:
|
|
|
|
|
||||
Amortization of prior service cost (credit) included in net periodic benefit cost (income), net of income tax expense (benefit) of $(170) in 2020 and $(185) 2019
|
|
(531
|
)
|
|
(601
|
)
|
||
Amortization of actuarial net loss (gain) included in net periodic benefit cost (income), net of income tax expense (benefit) of $397 in 2020 and $254 in 2019
|
|
1,267
|
|
|
841
|
|
||
Total pension plans and other postretirement benefits
|
|
736
|
|
|
240
|
|
||
Foreign currency translation adjustments, net of income tax expense (benefit) of $(841) in 2020 and $(107) in 2019
|
|
(14,331
|
)
|
|
4,946
|
|
||
Other comprehensive income (loss)
|
|
(13,595
|
)
|
|
5,186
|
|
||
Comprehensive income
|
|
$
|
71,946
|
|
|
$
|
67,391
|
|
(in thousands, except share amounts)
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
178,662
|
|
|
$
|
144,397
|
|
Trade and other accounts receivable, less allowance for credit losses
|
|
347,155
|
|
|
335,826
|
|
||
Inventories
|
|
371,002
|
|
|
365,938
|
|
||
Prepaid expenses and other current assets
|
|
34,115
|
|
|
33,237
|
|
||
Total current assets
|
|
930,934
|
|
|
879,398
|
|
||
Property, plant, and equipment, net
|
|
633,873
|
|
|
635,439
|
|
||
Intangibles (net of amortization) and goodwill
|
|
131,012
|
|
|
131,880
|
|
||
Prepaid pension cost
|
|
136,346
|
|
|
133,848
|
|
||
Operating lease right-of-use assets
|
|
57,437
|
|
|
60,505
|
|
||
Deferred charges and other assets
|
|
44,083
|
|
|
44,062
|
|
||
Total assets
|
|
$
|
1,933,685
|
|
|
$
|
1,885,132
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
178,457
|
|
|
$
|
178,773
|
|
Accrued expenses
|
|
89,819
|
|
|
77,350
|
|
||
Dividends payable
|
|
19,020
|
|
|
19,217
|
|
||
Income taxes payable
|
|
7,460
|
|
|
10,632
|
|
||
Operating lease liabilities
|
|
13,060
|
|
|
14,036
|
|
||
Other current liabilities
|
|
5,096
|
|
|
8,887
|
|
||
Total current liabilities
|
|
312,912
|
|
|
308,895
|
|
||
Long-term debt
|
|
740,511
|
|
|
642,941
|
|
||
Operating lease liabilities-noncurrent
|
|
43,585
|
|
|
46,792
|
|
||
Other noncurrent liabilities
|
|
197,428
|
|
|
203,406
|
|
||
Total liabilities
|
|
1,294,436
|
|
|
1,202,034
|
|
||
Commitments and contingencies (Note 9)
|
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
|
||||
Common stock and paid-in capital (without par value; authorized shares - 80,000,000; issued and outstanding shares - 10,938,744 at March 31, 2020 and 11,188,549 at December 31, 2019)
|
|
0
|
|
|
1,965
|
|
||
Accumulated other comprehensive loss
|
|
(176,343
|
)
|
|
(162,748
|
)
|
||
Retained earnings
|
|
815,592
|
|
|
843,881
|
|
||
Total shareholders' equity
|
|
639,249
|
|
|
683,098
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
1,933,685
|
|
|
$
|
1,885,132
|
|
(in thousands, except share and per-share amounts)
|
|
Common Stock and
Paid-in Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Retained Earnings
|
|
Total
Shareholders’ Equity
|
|||||||||||
|
Shares
|
|
Amount
|
|
|
|
|||||||||||||
Balance at December 31, 2018
|
|
11,184,482
|
|
|
$
|
0
|
|
|
$
|
(181,316
|
)
|
|
$
|
671,223
|
|
|
$
|
489,907
|
|
Net income
|
|
|
|
|
|
|
|
62,205
|
|
|
62,205
|
|
|||||||
Other comprehensive income (loss)
|
|
|
|
|
|
5,186
|
|
|
|
|
5,186
|
|
|||||||
Cash dividends ($1.75 per share)
|
|
|
|
|
|
|
|
(19,579
|
)
|
|
(19,579
|
)
|
|||||||
Stock-based compensation
|
|
3,644
|
|
|
431
|
|
|
|
|
|
46
|
|
|
477
|
|
||||
Balance at March 31, 2019
|
|
11,188,126
|
|
|
$
|
431
|
|
|
$
|
(176,130
|
)
|
|
$
|
713,895
|
|
|
$
|
538,196
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at December 31, 2019
|
|
11,188,549
|
|
|
$
|
1,965
|
|
|
$
|
(162,748
|
)
|
|
$
|
843,881
|
|
|
$
|
683,098
|
|
Net income
|
|
|
|
|
|
|
|
85,541
|
|
|
85,541
|
|
|||||||
Other comprehensive income (loss)
|
|
|
|
|
|
(13,595
|
)
|
|
|
|
(13,595
|
)
|
|||||||
Cash dividends ($1.90 per share)
|
|
|
|
|
|
|
|
(21,160
|
)
|
|
(21,160
|
)
|
|||||||
Repurchases of common stock
|
|
(252,383
|
)
|
|
(1,627
|
)
|
|
|
|
(92,711
|
)
|
|
(94,338
|
)
|
|||||
Tax withholdings related to stock-based compensation
|
|
(1,547
|
)
|
|
(633
|
)
|
|
|
|
|
|
|
(633
|
)
|
|||||
Stock-based compensation
|
|
4,125
|
|
|
295
|
|
|
|
|
41
|
|
|
336
|
|
|||||
Balance at March 31, 2020
|
|
10,938,744
|
|
|
$
|
0
|
|
|
$
|
(176,343
|
)
|
|
$
|
815,592
|
|
|
$
|
639,249
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Cash and cash equivalents at beginning of year
|
|
$
|
144,397
|
|
|
$
|
73,040
|
|
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
85,541
|
|
|
62,205
|
|
||
Adjustments to reconcile net income to cash flows from operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
21,369
|
|
|
21,939
|
|
||
Deferred income tax expense
|
|
3,379
|
|
|
2,156
|
|
||
Working capital changes
|
|
(42,058
|
)
|
|
(63,426
|
)
|
||
Cash pension and postretirement contributions
|
|
(2,557
|
)
|
|
(2,425
|
)
|
||
Other, net
|
|
(1,213
|
)
|
|
(1,317
|
)
|
||
Cash provided from (used in) operating activities
|
|
64,461
|
|
|
19,132
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Capital expenditures
|
|
(20,106
|
)
|
|
(10,353
|
)
|
||
Cash provided from (used in) investing activities
|
|
(20,106
|
)
|
|
(10,353
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Net borrowings under revolving credit facility
|
|
97,424
|
|
|
16,072
|
|
||
Dividends paid
|
|
(21,160
|
)
|
|
(19,579
|
)
|
||
Repurchases of common stock
|
|
(79,473
|
)
|
|
0
|
|
||
Other, net
|
|
(2,685
|
)
|
|
(613
|
)
|
||
Cash provided from (used in) financing activities
|
|
(5,894
|
)
|
|
(4,120
|
)
|
||
Effect of foreign exchange on cash and cash equivalents
|
|
(4,196
|
)
|
|
548
|
|
||
Increase in cash and cash equivalents
|
|
34,265
|
|
|
5,207
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
178,662
|
|
|
$
|
78,247
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31, |
||||||
(in thousands)
|
|
2020
|
|
2019
|
||||
Net sales
|
|
|
|
|
||||
United States
|
|
$
|
181,844
|
|
|
$
|
172,014
|
|
China
|
|
45,798
|
|
|
59,293
|
|
||
Europe, Middle East, Africa, India
|
|
190,623
|
|
|
168,319
|
|
||
Asia Pacific, except China
|
|
79,413
|
|
|
82,529
|
|
||
Other foreign
|
|
61,739
|
|
|
54,461
|
|
||
Net sales
|
|
$
|
559,417
|
|
|
$
|
536,616
|
|
|
|
Three Months Ended
March 31, |
||||||
(in thousands)
|
|
2020
|
|
2019
|
||||
Petroleum additives
|
|
|
|
|
||||
Lubricant additives
|
|
$
|
463,686
|
|
|
$
|
437,220
|
|
Fuel additives
|
|
93,686
|
|
|
95,459
|
|
||
Total
|
|
557,372
|
|
|
532,679
|
|
||
All other
|
|
2,045
|
|
|
3,937
|
|
||
Net sales
|
|
$
|
559,417
|
|
|
$
|
536,616
|
|
|
|
Three Months Ended
March 31, |
||||||
(in thousands)
|
|
2020
|
|
2019
|
||||
Petroleum additives
|
|
$
|
113,671
|
|
|
$
|
87,863
|
|
All other
|
|
335
|
|
|
511
|
|
||
Segment operating profit
|
|
114,006
|
|
|
88,374
|
|
||
Corporate, general, and administrative expenses
|
|
(4,231
|
)
|
|
(5,094
|
)
|
||
Interest and financing expenses, net
|
|
(7,104
|
)
|
|
(8,012
|
)
|
||
Other income (expense), net
|
|
7,407
|
|
|
5,540
|
|
||
Income before income tax expense
|
|
$
|
110,078
|
|
|
$
|
80,808
|
|
(in thousands)
|
|
Actual Cash Contributions for Three Months Ended March 31, 2020
|
|
Expected Remaining Cash Contributions for Year Ending December 31, 2020
|
||||
Domestic plans
|
|
|
|
|
||||
Pension benefits
|
|
$
|
719
|
|
|
$
|
2,157
|
|
Postretirement benefits
|
|
411
|
|
|
1,232
|
|
||
Foreign plans
|
|
|
|
|
||||
Pension benefits
|
|
1,427
|
|
|
4,324
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
||||||||||||||
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
|
|
Three Months Ended March 31,
|
||||||||||||||
(in thousands)
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Service cost
|
|
$
|
4,197
|
|
|
$
|
3,623
|
|
|
$
|
217
|
|
|
$
|
194
|
|
Interest cost
|
|
3,508
|
|
|
3,685
|
|
|
345
|
|
|
389
|
|
||||
Expected return on plan assets
|
|
(9,305
|
)
|
|
(8,657
|
)
|
|
(241
|
)
|
|
(244
|
)
|
||||
Amortization of prior service cost (credit)
|
|
66
|
|
|
(19
|
)
|
|
(757
|
)
|
|
(757
|
)
|
||||
Amortization of actuarial net (gain) loss
|
|
1,316
|
|
|
853
|
|
|
0
|
|
|
0
|
|
||||
Net periodic benefit cost (income)
|
|
$
|
(218
|
)
|
|
$
|
(515
|
)
|
|
$
|
(436
|
)
|
|
$
|
(418
|
)
|
|
|
Foreign
|
|||||||
|
|
Pension Benefits
|
|||||||
|
|
|
Three Months Ended March 31,
|
||||||
(in thousands)
|
|
|
2020
|
|
2019
|
||||
Service cost
|
|
|
$
|
2,146
|
|
|
$
|
1,640
|
|
Interest cost
|
|
|
984
|
|
|
1,221
|
|
||
Expected return on plan assets
|
|
|
(2,461
|
)
|
|
(2,353
|
)
|
||
Amortization of prior service cost (credit)
|
|
|
(11
|
)
|
|
(11
|
)
|
||
Amortization of actuarial net (gain) loss
|
|
|
353
|
|
|
239
|
|
||
Net periodic benefit cost (income)
|
|
|
$
|
1,011
|
|
|
$
|
736
|
|
|
|
Three Months Ended
March 31, |
||||||
(in thousands, except per-share amounts)
|
|
2020
|
|
2019
|
||||
Earnings per share numerator:
|
|
|
|
|
||||
Net income attributable to common shareholders before allocation of earnings to participating securities
|
|
$
|
85,541
|
|
|
$
|
62,205
|
|
Earnings allocated to participating securities
|
|
112
|
|
|
64
|
|
||
Net income attributable to common shareholders after allocation of earnings to participating securities
|
|
$
|
85,429
|
|
|
$
|
62,141
|
|
Earnings per share denominator:
|
|
|
|
|
||||
Weighted-average number of shares of common stock outstanding - basic and diluted
|
|
11,136
|
|
|
11,166
|
|
||
Earnings per share - basic and diluted
|
|
$
|
7.67
|
|
|
$
|
5.57
|
|
6.
|
Inventories
|
|
|
March 31,
|
|
December 31,
|
||||
(in thousands)
|
|
2020
|
|
2019
|
||||
Finished goods and work-in-process
|
|
$
|
298,533
|
|
|
$
|
295,997
|
|
Raw materials
|
|
58,072
|
|
|
55,702
|
|
||
Stores, supplies, and other
|
|
14,397
|
|
|
14,239
|
|
||
|
|
$
|
371,002
|
|
|
$
|
365,938
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
(in thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Amortizing intangible assets
|
|
|
|
|
|
|
|
|
||||||||
Formulas and technology
|
|
$
|
9,600
|
|
|
$
|
5,817
|
|
|
$
|
9,600
|
|
|
$
|
5,416
|
|
Contract
|
|
2,000
|
|
|
650
|
|
|
2,000
|
|
|
600
|
|
||||
Customer bases
|
|
14,240
|
|
|
11,207
|
|
|
14,240
|
|
|
10,931
|
|
||||
Goodwill
|
|
122,846
|
|
|
|
|
122,987
|
|
|
|
||||||
|
|
$
|
148,686
|
|
|
$
|
17,674
|
|
|
$
|
148,827
|
|
|
$
|
16,947
|
|
Three months ended March 31, 2020
|
$
|
727
|
|
Three months ended March 31, 2019
|
1,051
|
|
2020
|
$
|
2,180
|
|
2021
|
2,156
|
|
|
2022
|
1,423
|
|
|
2023
|
907
|
|
|
2024
|
390
|
|
|
2025
|
390
|
|
(in thousands)
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Senior notes - 4.10% due 2022 (net of related deferred financing costs)
|
|
$
|
348,409
|
|
|
$
|
348,263
|
|
Senior notes - 3.78% due 2029
|
|
250,000
|
|
|
250,000
|
|
||
Revolving credit facility
|
|
142,102
|
|
|
44,678
|
|
||
|
|
$
|
740,511
|
|
|
$
|
642,941
|
|
(in thousands)
|
|
Pension Plans
and Other Postretirement Benefits
|
|
Foreign Currency Translation Adjustments
|
|
Accumulated Other
Comprehensive (Loss) Income
|
||||||
Balance at December 31, 2018
|
|
$
|
(86,555
|
)
|
|
$
|
(94,761
|
)
|
|
$
|
(181,316
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
0
|
|
|
4,946
|
|
|
4,946
|
|
|||
Amounts reclassified from accumulated other comprehensive loss (a)
|
|
240
|
|
|
0
|
|
|
240
|
|
|||
Other comprehensive income (loss)
|
|
240
|
|
|
4,946
|
|
|
5,186
|
|
|||
Balance at March 31, 2019
|
|
$
|
(86,315
|
)
|
|
$
|
(89,815
|
)
|
|
$
|
(176,130
|
)
|
|
|
|
|
|
|
|
||||||
Balance at December 31, 2019
|
|
$
|
(69,795
|
)
|
|
$
|
(92,953
|
)
|
|
$
|
(162,748
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
0
|
|
|
(14,331
|
)
|
|
(14,331
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss (a)
|
|
736
|
|
|
0
|
|
|
736
|
|
|||
Other comprehensive income (loss)
|
|
736
|
|
|
(14,331
|
)
|
|
(13,595
|
)
|
|||
Balance at March 31, 2020
|
|
$
|
(69,059
|
)
|
|
$
|
(107,284
|
)
|
|
$
|
(176,343
|
)
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
(in thousands)
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
Long-term debt
|
|
$
|
740,511
|
|
|
$
|
725,861
|
|
|
$
|
642,941
|
|
|
$
|
677,253
|
|
|
|
Three Months Ended
March 31, |
||||||
(in millions)
|
|
2020
|
|
2019
|
||||
Petroleum additives
|
|
|
|
|
||||
Lubricant additives
|
|
$
|
463.7
|
|
|
$
|
437.2
|
|
Fuel additives
|
|
93.7
|
|
|
95.5
|
|
||
Total
|
|
557.4
|
|
|
532.7
|
|
||
All other
|
|
2.0
|
|
|
3.9
|
|
||
Net sales
|
|
$
|
559.4
|
|
|
$
|
536.6
|
|
(in millions)
|
|
Three Months
|
||
Period ended March 31, 2019
|
|
$
|
532.7
|
|
Lubricant additives shipments
|
|
30.6
|
|
|
Fuel additives shipments
|
|
(1.0
|
)
|
|
Selling prices
|
|
(1.7
|
)
|
|
Foreign currency impact, net
|
|
(3.2
|
)
|
|
Period ended March 31, 2020
|
|
$
|
557.4
|
|
|
|
Three Months Ended
March 31, |
||||||
(in millions)
|
|
2020
|
|
2019
|
||||
Petroleum additives
|
|
$
|
113.7
|
|
|
$
|
87.9
|
|
All other
|
|
$
|
0.3
|
|
|
$
|
0.5
|
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
|
||||
January 1 to January 31
|
|
0
|
|
$
|
0.00
|
|
|
0
|
|
$
|
500,000,000
|
|
February 1 to February 29
|
|
6,753
|
|
395.62
|
|
|
6,753
|
|
497,328,353
|
|
||
March 1 to March 31
|
|
245,630
|
|
373.19
|
|
|
245,630
|
|
405,661,755
|
|
||
Total
|
|
252,383
|
|
$
|
373.79
|
|
|
252,383
|
|
$
|
405,661,755
|
|
|
NEWMARKET CORPORATION
|
|
(Registrant)
|
|
|
Date: April 23, 2020
|
By: /s/ Brian D. Paliotti
|
|
Brian D. Paliotti
|
|
Vice President and
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
|
|
Date: April 23, 2020
|
By: /s/ William J. Skrobacz
|
|
William J. Skrobacz
|
|
Controller
|
|
(Principal Accounting Officer)
|
1 Year NewMarket Chart |
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