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Valvoline's 3Q and FY Sales and Earnings Up; FUCHS Reports Double-digit 9M16 Sales Growth

Valvoline reported increases in lubricant volumes and sales of 2 percent, or 43.5 million gallons to 44.5 million gallons and $484 million to $494 million, respectively. FUCHS PETROLUB reported that the Group recorded a double-digit increase in sales revenues in the first nine months of 2016. EBIT increased by 6% to EUR 276 million.

Valvoline

Valvoline Inc.™ last Tuesday announced preliminary financial results for the fourth quarter and fiscal year ended September 30, 2016.

In its first quarter as a public company, Valvoline reported increases in lubricant volumes and sales of 2 percent, or 43.5 million gallons to 44.5 million gallons and $484 million to $494 million, respectively. Operating income during the three months ending Sept. 30 (the fourth quarter of parent Ashland’s fiscal year) was $96 million, up 10.3 percent from $87 million in the year-earlier quarter. Net income for the quarter was $65 million. The Company also reported a 12 percent increase in adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) and adjusted earnings per diluted share growth of 4 percent from $0.28 to $0.29.

According to the company, these solid fourth quarter results were driven by growth in premium product sales, sound execution with channel partners, significant increases in same store sales and store count, and by the February acquisition of 89 Oil Can Henry’s stores. Continued volume growth in emerging markets also contributed to Valvoline’s productive quarter.

For fiscal 2016, Valvoline reported a 4 percent increase in lubricant volume to 174.5 million gallons. For its fiscal year ending Sept. 30, Valvoline’s operating income reached $403 million, up 12.3 percent from $359 million for the previous fiscal year. Net income for the year was $273 million. The Company also reported a 9 percent increase in adjusted EBITDA, reaching $457 million, and adjusted earnings per share diluted share growth of 6 percent from $1.24 to $1.31. Sales mix was strong during the year with premium lubricant volume growing in both Core North America and Quick Lubes. Reduced product selling prices reflecting lower raw material costs offset favorable mix, leading to a 2 percent decline in sales. The segment’s sales for the 2016 fiscal year was $1.93 billion, slightly down from $1.97 billion in 2015.

FUCHS PETROLUB

"FUCHS PETROLUB reported November 3 that "despite unfavorable currency effects", the Group recorded a double-digit increase in sales revenues, up 11% to EUR 1.703 (US$1.86) billion, in the first nine months of 2016 attributable to organic growth and the acquisitions completed in 2015. EBIT increased by 6% to EUR 276 million and free cash flow before acquisitions is above the previous year’s level, despite higher capital expenditure," comments Stefan Fuchs, Chairman of the Executive Board at FUCHS PETROLUB SE.

In the first nine months of 2016 FUCHS PETROLUB increased its sales revenues by 11% to EUR 1,703 million (compared to EUR 1,539 million in the previous years first nine months). Organic growth accelerated to 3% over the course of the year. External growth driven by the acquisitions made in the previous year was 11% and negative currency effects amounted to -3%.

The income statement is also influenced by the previous year's acquisitions. The earning power of the companies acquired in 2015 is still below the Group average. In total, EBIT increased by 6% to EUR 276 million (compared to EUR 261 million in the previous years first nine months). Earnings after tax also increased by 6% to EUR 192 million (compared to EUR 181 million in the previous years first nine months).

Despite the higher capital expenditures, the free cash flow before acquisitions of EUR 145 million is slightly above the previous year's level of EUR 143 million

The regional analysis shows that Europe recorded strong growth largely as a result of acquisitions (+19%) and that organic gains (+4%) were achieved particularly in Germany and Central & Eastern Europe. The Asia-Pacific, Africa region is 2% above the previous year. The organic growth recorded (+5%) can primarily be attributed to China, India and South Africa. Due to weak South American currencies and an ongoing period of weak demand in the mining, oil, gas and steel industries, North and South America remains around 3% below the previous year.

The Europe region increased its EBIT by 17% to EUR 149 million, while Asia-Pacific, Africa recorded a rise of 3% to EUR 90 million. At EUR 47 million, EBIT in North and South America region is 6% below the previous year's figure.

FUCHS PETROLUB anticipates organic and acquisition-based growth in sales revenues at the top end of the forecast range of 7% to 11%. Considering negative currency effects, the Group expects sales revenues to grow between 7% and 8%. The Group anticipates EBIT growth in the range of 4% to 6%. Free cash flow before acquisitions is likely in the upper range of the forecast of EUR 170 million to 200 million.


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