Innospec (IOSP) Q1 2026 Earnings Transcript

Motley Fool Transcribing, The Motley Fool Fri, May 8, 2026 at 9:20 PM GMT+7 17 min read IOSP Image source: The Motley Fool. President and Chief Executive Officer — Patrick Williams Executive Vice President and Chief Financial Officer — Ian Cleminson Patrick Williams, President and Chief Executive Officer, and Ian Cleminson, Executive Vice President and Chief Financial Officer. With that, I will turn it over to you, Patrick. Patrick Williams: Thank you, David, and welcome, everyone, to Innospec Inc. s first quarter 2026 conference call. Before discussing the results, I want to recognize the focus and determination being demonstrated by our employees around the world, and especially those in the Middle East. Volatile environments like this bring a unique set of challenges and opportunities. We are seeing increased chances to deliver innovative solutions and security of supply to all our customers, and we continue to execute on these initiatives. This was a mixed quarter for Innospec Inc., with continued strong results in Fuel Specialties partially offsetting the impacts of the January 2026 U.S. winter storm, which affected Performance Chemicals and Oilfield Services. Performance Chemicals sales were broadly flat with last year, but margins and operating income were significantly impacted by the shutdown of our North Carolina plants due to the U.S. winter storm. We are continuing to prioritize plant repairs in order to meet customer requirements. Additionally, and without slowing the pace of these critical plant repairs, we have elected to pull forward multiple plant optimization projects which will drive long-term benefits. In parallel, we continue to execute on a range of top-line and margin opportunities identified in the business which we expect to drive sequential growth in the second quarter. Fuel Specialties had another strong quarter with sales growth and margins that remained at the upper end of our target range. The business has continued to deliver consistent strong results through a range of economic cycles. With a diverse pipeline and a number of non-fuel opportunities across all regions, we expect a continued strong performance in this business. Oilfield Services operating income and margins improved on the prior year, but sequential results were impacted by the U.S. winter storm. While the Middle East conflict may delay some activity in the region, it is also creating new opportunities that we are aggressively pursuing. In parallel, we remain focused on driving incremental growth from our recent DRA expansion and other opportunities in our Completions and Production segments. We are cautiously optimistic that this combination will deliver sequential operating improvement in the second quarter and leave us well-positioned for further improvement in 2026. Now I will turn the call over to Ian Cleminson, who will review our financial results in more detail. Then I will return with some concluding comments. After that, Ian and I will take your questions. Ian? Ian Cleminson: Thanks, Patrick. Turning to slide seven in the presentation, the company s total revenues for the first quarter were 453.2 million dollars, a 3% increase from 440.8 million dollars a year ago. Overall gross margin decreased by 1.1 percentage points from last year to 27.3%. Adjusted EBITDA for the quarter was 43.7 million dollars compared to 54 million dollars last year. Net income attributable to Innospec Inc. for the quarter was 30.4 million dollars compared to 32.8 million dollars a year ago. Our GAAP earnings per share were 1.22 dollars, including special items, the net effect of which increased our first quarter earnings by 0.17 dollars per share. A year ago, we reported GAAP earnings per share of 1.31 dollars, which included a negative impact from special items of 0.11 dollars per share. Excluding special items in both years, our adjusted EPS for the quarter was 1.05 dollars compared to 1.42 dollars a year ago. Turning to slide eight. Revenues in Performance Chemicals for the first quarter were 169.4 million dollars, up 1% from last year s 168.4 million dollars. Volume reductions of 9% were offset by a positive price/mix of 1% and a favorable currency impact of 9%. Gross margins of 16.8% decreased 4.2 percentage points compared to 21% in the same quarter in 2025 due to the impact of the U.S. winter storm at the start of the quarter. Operating income of 10.7 million dollars decreased 46% from 19.8 million dollars last year. Moving on to slide nine. Revenues in Fuel Specialties for the first quarter were 181.6 million dollars, up 7% from the 170.3 million dollars reported a year ago. A 10% increase in volumes and a favorable currency impact of 6% were offset by a negative price/mix of 9%. Fuel Specialties gross margins of 35.4% were broadly flat with the same quarter last year. Operating income of 37.8 million dollars was up 2% from 36.9 million dollars a year ago. Moving on to slide 10. Revenues in Oilfield Services

Innospec (IOSP) Q1 2026 Earnings Transcript

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Innospec (IOSP) Q1 2026 Earnings Transcript

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