Valvoline turned in a strong performance as improved mix and lower raw-material costs led to higher profitability and margins in the second quarter of parent company Ashland's fiscal year. EBITDA rose 18 percent, to $106 million, and EBITDA as a percent of sales was 22.0 percent, an increase of 410 basis points versus the prior year. Although three of Valvoline`s four channels to market reported year-over-year volume gains, total sales declined 4 percent, to $481 million, primarily as a result of currency headwinds. Successful promotions drove volume growth in Do-it-Yourself (DIY). Valvoline Instant Oil Change (VIOC) reported same-store sales growth of nearly 7 percent at company-owned sites. Across the broader VIOC network, the total number of oil changes rose 7 percent, with 9 percent growth in premium oil changes. Within Valvoline`s international channel, growth appeared to return as distributor destocking issues abated. Both volume and currency-adjusted sales in the international channel rose 2 percent. On a global basis, Valvoline`s overall mix continued to improve, with premium-branded lubricant sales volume increasing to 40.7 percent from 37.1 percent a year ago.

Earlier in April, Ashland agreed to sell Valvoline`s car-care products assets to Highlander Capital LLP. These assets include brands such as Car BriteTM, Eagle OneTM and PyroilTM. Also included in the sale are Valvoline-branded and private-label maintenance chemicals sold into the DIY channel. According to the company, proceeds from the sale of this non-strategic asset will be reinvested in generating more rapid, profitable growth within Valvoline`s core lubricants business, such as through the continued expansion of the VIOC store base.

For the third fiscal quarter, Valvoline expects to continue benefiting from strong promotions across its U.S. channels as the summer driving season approaches. The company says that good product and business mix should drive strong margins, although continued price adjustments will likely offset some of that strength.

Parent company Ashland reported earnings from continuing operations of $95 million on sales of $1.35 billion. These results included five key items that together reduced income from continuing operations by approximately $43 million, net of tax. Excluding the five key items, Ashland`s adjusted income from continuing operations was $138 million. For the year-ago quarter, Ashland reported a loss from continuing operations of $61 million on sales of $1.5 billion. There were five key items in the year-ago quarter that, on a combined basis, reduced income from continuing operations by $181 million after tax. Excluding those five items, Ashland`s adjusted income from continuing operations was $120 million.