NewMarket Corporation reported last Wednesday that its petroleum additives group, Afton Chemical's operating profit for the second quarter of 2015 was $94.1 million, a 13.8% decline over the record second quarter operating profit set last year of $109.1 million. The decrease was mainly due to an increase in research and development investments and changes in foreign currency exchange, partially offset by lower raw material costs, during the quarter. Sales for the petroleum additives segment for the second quarter of 2015 were $557.4 million, down 9.7% versus the same period last year, due mainly to foreign currency exchange and lower shipments. Shipments were down 2.3% between the periods, primarily due to lower shipments of lubricant additives products in the North America region.
For the first half of the year, operating profit for the petroleum additives segment was $199.1 million compared to $205.3 million for the first half of 2014, or a decrease of 3.0%. Similar to the quarterly periods, the decrease was mainly due to an increase in research and development investments and changes in foreign currency exchange, partially offset by lower raw material costs. Sales for the first half of this year were $1,112 million compared to sales in the first half of last year of $1,192 million, or a decrease of 6.7%. This decrease was primarily due to foreign currency exchange. Shipments remained relatively flat between the periods, with increases in fuel additives shipments in the North America region offset by declines in lubricant additives globally.
NewMarket Corporation Chairman and Chief Executive Officer, Thomas E. Gottwald, said "Our petroleum additives business continues to perform well compared to a record second quarter of 2014, and in a business climate marked by slower world economic growth and a strong US Dollar. Our ongoing commitment to provide our customers with innovative products and solutions to meet their business needs is evidenced by the 18% increase in our research and development investments in the first six months of 2015 compared to the same period last year and the construction of our manufacturing facility in Singapore. We believe the fundamentals of how we run our business - a long-term view, safety-first culture, customer-focused solutions, technology-driven product offerings, and world class supply chain capability - will continue to be beneficial for all our stakeholders".
Net income for parent company NewMarket Corp for the second quarter of 2015 was $58.7 million compared to net income of $66.8 million for the second quarter of 2014. For the first half of 2015, net income was $122.7 million compared to net income of $124.3 million for the first half of last year. Net income for all periods included the impact of valuing an interest rate swap at fair value. Excluding this item, second quarter 2015 earnings were $57.8 million compared to $68.2 million last year. On the same basis, earnings for the first half of this year were $123.2 million compared to $127.0 million last year.
