Company Quick10K Filing
NewMarket
Price464.58 EPS24
Shares11 P/E19
MCap5,198 P/FCF22
Net Debt560 EBIT350
TEV5,758 TEV/EBIT16
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-07-30
10-Q 2020-03-31 Filed 2020-04-23
10-K 2019-12-31 Filed 2020-02-18
10-Q 2019-09-30 Filed 2019-10-24
10-Q 2019-06-30 Filed 2019-08-01
10-Q 2019-03-31 Filed 2019-04-25
10-K 2018-12-31 Filed 2019-02-19
10-Q 2018-09-30 Filed 2018-10-25
10-Q 2018-06-30 Filed 2018-08-09
10-Q 2018-03-31 Filed 2018-04-26
10-K 2017-12-31 Filed 2018-02-15
10-Q 2017-09-30 Filed 2017-10-26
10-Q 2017-06-30 Filed 2017-08-03
10-Q 2017-03-31 Filed 2017-04-27
10-K 2016-12-31 Filed 2017-02-15
10-Q 2016-09-30 Filed 2016-10-27
10-Q 2016-06-30 Filed 2016-07-28
10-Q 2016-03-31 Filed 2016-04-28
10-K 2015-12-31 Filed 2016-02-12
10-Q 2015-09-30 Filed 2015-10-28
10-Q 2015-06-30 Filed 2015-07-29
10-Q 2015-03-31 Filed 2015-04-29
10-K 2014-12-31 Filed 2015-02-17
10-Q 2014-09-30 Filed 2014-10-30
10-Q 2014-06-30 Filed 2014-07-30
10-Q 2014-03-31 Filed 2014-04-30
10-K 2013-12-31 Filed 2014-02-19
10-Q 2013-09-30 Filed 2013-10-31
10-Q 2013-06-30 Filed 2013-07-31
10-Q 2013-03-31 Filed 2013-04-29
10-K 2012-12-31 Filed 2013-02-15
10-Q 2012-09-30 Filed 2012-10-26
10-Q 2012-06-30 Filed 2012-07-31
10-Q 2012-03-31 Filed 2012-05-02
10-K 2011-12-31 Filed 2012-02-22
10-Q 2011-09-30 Filed 2011-11-02
10-Q 2011-06-30 Filed 2011-08-04
10-Q 2011-03-31 Filed 2011-04-29
10-K 2010-12-31 Filed 2011-02-22
10-Q 2010-09-30 Filed 2010-10-29
10-Q 2010-06-30 Filed 2010-08-04
10-Q 2010-03-31 Filed 2010-04-28
10-K 2009-12-31 Filed 2010-02-19
8-K 2020-08-06 Other Events, Exhibits
8-K 2020-07-29 Earnings, Exhibits
8-K 2020-07-16 Officers
8-K 2020-04-23
8-K 2020-04-23
8-K 2020-04-22
8-K 2020-03-05
8-K 2020-02-27
8-K 2020-02-03
8-K 2019-10-24
8-K 2019-10-23
8-K 2019-08-01
8-K 2019-07-31
8-K 2019-04-25
8-K 2019-04-24
8-K 2019-02-28
8-K 2019-02-06
8-K 2019-02-06
8-K 2018-12-13
8-K 2018-11-16
8-K 2018-10-25
8-K 2018-10-24
8-K 2018-08-09
8-K 2018-08-08
8-K 2018-05-15
8-K 2018-04-26
8-K 2018-04-25
8-K 2018-02-22
8-K 2018-02-22
8-K 2018-02-06
8-K 2018-01-23

NEU 10Q Quarterly Report

Part I. Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.A neu-2020630xexhibit31a.htm
EX-31.B neu-2020630xexhibit31b.htm
EX-32.A neu-2020630xexhibit32a.htm
EX-32.B neu-2020630xexhibit32b.htm

NewMarket Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
1.91.51.10.80.40.02012201420172020
Assets, Equity
0.70.60.40.30.10.02012201420172020
Rev, G Profit, Net Income
0.20.10.0-0.0-0.1-0.22012201420172020
Ops, Inv, Fin

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Table of Contents 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission File Number 1-32190
NEWMARKET CORPORATION
(Exact name of registrant as specified in its charter)
 
Virginia 20-0812170
(State or other jurisdiction of
incorporation or organization)
 (I.R.S. Employer
Identification No.)
330 South Fourth Street23219-4350
Richmond,Virginia 
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code - (804) 788-5000
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, with no par valueNEUNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
x
Accelerated filer
¨
Non-accelerated filer
¨
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨


Table of Contents 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes   No  x
Number of shares of common stock, without par value, outstanding as of June 30, 2020: 10,923,999


Table of Contents
NEWMARKET CORPORATION

INDEX
 Page
Number
3

Table of Contents 

PART I. FINANCIAL INFORMATION
ITEM 1.  Financial Statements

NEWMARKET CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
 
(in thousands, except per-share amounts)Second Quarter Ended
June 30,
Six Months Ended
June 30,
 2020201920202019
Net sales$410,864  $563,417  $970,281  $1,100,033  
Cost of goods sold314,126  392,584  692,636  776,331  
Gross profit96,738  170,833  277,645  323,702  
Selling, general, and administrative expenses35,432  35,021  71,147  71,794  
Research, development, and testing expenses33,549  37,137  69,055  70,361  
Operating profit27,757  98,675  137,443  181,547  
Interest and financing expenses, net7,005  7,741  14,109  15,753  
Other income (expense), net6,516  5,757  14,012  11,705  
Income before income tax expense27,268  96,691  137,346  177,499  
Income tax expense4,919  22,517  29,456  41,120  
Net income$22,349  $74,174  $107,890  $136,379  
Earnings per share - basic and diluted$2.05  $6.63  $9.78  $12.20  
Cash dividends declared per share$1.90  $1.75  $3.80  $3.50  
See accompanying Notes to Condensed Consolidated Financial Statements

4

Table of Contents

NEWMARKET CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
 (in thousands)Second Quarter Ended
June 30,
Six Months Ended
June 30,
 2020201920202019
Net income$22,349  $74,174  $107,890  $136,379  
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 $(171) in second quarter 2020, $(186) in second quarter 2019, $(341) in six months 2020, and $(371) in six months 2019
(531) (601) (1,062) (1,202) 
Amortization of actuarial net loss (gain) included in net periodic benefit cost (income), net of income tax expense (benefit) of $396 in second quarter 2020, $251 in second quarter 2019, $793 in six months 2020, and $505 in six months 2019
1,260  834  2,527  1,675  
Total pension plans and other postretirement benefits
729  233  1,465  473  
Foreign currency translation adjustments, net of income tax expense (benefit) of $(151) in second quarter 2020, $114 in second quarter 2019, $(992) in six months 2020, and $7 in six months 2019
(1,038) (4,366) (15,369) 580  
Other comprehensive income (loss)(309) (4,133) (13,904) 1,053  
Comprehensive income$22,040  $70,041  $93,986  $137,432  
See accompanying Notes to Condensed Consolidated Financial Statements

5

Table of Contents

NEWMARKET CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share amounts)June 30,
2020
December 31,
2019
ASSETS
Current assets:
Cash and cash equivalents$102,064  $144,397  
Trade and other accounts receivable, less allowance for credit losses
297,862  335,826  
Inventories354,821  365,938  
Prepaid expenses and other current assets35,277  33,237  
Total current assets790,024  879,398  
Property, plant, and equipment, net639,344  635,439  
Intangibles (net of amortization) and goodwill130,903  131,880  
Prepaid pension cost139,481  133,848  
Operating lease right-of-use assets55,935  60,505  
Deferred charges and other assets43,450  44,062  
Total assets$1,799,137  $1,885,132  
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable$127,401  $178,773  
Accrued expenses62,004  77,350  
Dividends payable18,530  19,217  
Income taxes payable3,508  10,632  
Operating lease liabilities12,592  14,036  
Other current liabilities9,948  8,887  
Total current liabilities233,983  308,895  
Long-term debt690,292  642,941  
Operating lease liabilities-noncurrent42,942  46,792  
Other noncurrent liabilities196,635  203,406  
Total liabilities1,163,852  1,202,034  
Commitments and contingencies (Note 9)
Shareholders’ equity:
Common stock and paid-in capital (with no par value; authorized shares - 80,000,000; issued and outstanding shares - 10,923,999 at June 30, 2020 and 11,188,549 at December 31, 2019)
281  1,965  
Accumulated other comprehensive loss(176,652) (162,748) 
Retained earnings811,656  843,881  
Total shareholders' equity635,285  683,098  
Total liabilities and shareholders’ equity$1,799,137  $1,885,132  
See accompanying Notes to Condensed Consolidated Financial Statements

6

Table of Contents

NEWMARKET CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
(in thousands, except share and per-share amounts)Common Stock and
Paid-in Capital
Accumulated Other Comprehensive LossRetained EarningsTotal
Shareholders’ Equity
SharesAmount
Balance at March 31, 201911,188,126  $431  $(176,130) $713,895  $538,196  
Net income74,174  74,174  
Other comprehensive income (loss)(4,133) (4,133) 
Cash dividends ($1.75 per share)
(19,579) (19,579) 
Stock-based compensation518  518  
Balance at June 30, 201911,188,126  $949  $(180,263) $768,490  $589,176  
Balance at March 31, 202010,938,744  $0  $(176,343) $815,592  $639,249  
Net income22,349  22,349  
Other comprehensive income (loss)(309) (309) 
Cash dividends ($1.90 per share)
(20,756) (20,756) 
Repurchases of common stock(14,745) (133) (5,529) (5,662) 
Tax withholdings related to stock-based compensation(8) (8) 
Stock-based compensation422  422  
Balance at June 30, 202010,923,999  $281  $(176,652) $811,656  $635,285  
Balance at December 31, 201811,184,482  $0  $(181,316) $671,223  $489,907  
Net income136,379  136,379  
Other comprehensive income (loss)1,053  1,053  
Cash dividends ($3.50 per share)
(39,158) (39,158) 
Stock-based compensation3,644  949  46  995  
Balance at June 30, 201911,188,126  $949  $(180,263) $768,490  $589,176  
Balance at December 31, 201911,188,549  $1,965  $(162,748) $843,881  $683,098  
Net income107,890  107,890  
Other comprehensive income (loss)(13,904) (13,904) 
Cash dividends ($3.80 per share)
(41,916) (41,916) 
Repurchases of common stock(267,128) (1,760) (98,240) (100,000) 
Tax withholdings related to stock-based compensation(1,547) (641) (641) 
Stock-based compensation4,125  717  41  758  
Balance at June 30, 202010,923,999  $281  $(176,652) $811,656  $635,285  
See accompanying Notes to Condensed Consolidated Financial Statements

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 (in thousands)Six Months Ended
June 30,
 20202019
Cash and cash equivalents at beginning of year$144,397  $73,040  
Cash flows from operating activities:
Net income107,890  136,379  
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization42,356  43,716  
Deferred income tax expense3,322  4,154  
Working capital changes(60,072) (27,079) 
Cash pension and postretirement contributions(5,152) (4,869) 
Other, net5,953  (1,685) 
Cash provided from (used in) operating activities94,297  150,616  
Cash flows from investing activities:
Capital expenditures(40,088) (23,219) 
Other, net(927) 0  
Cash provided from (used in) investing activities(41,015) (23,219) 
Cash flows from financing activities:
Net borrowings (repayments) under revolving credit facility47,059  (87,296) 
Dividends paid(41,916) (39,158) 
Repurchases of common stock(100,000) 0  
Other, net2,217  (1,233) 
Cash provided from (used in) financing activities(92,640) (127,687) 
Effect of foreign exchange on cash and cash equivalents(2,975) 469  
(Decrease) increase in cash and cash equivalents(42,333) 179  
Cash and cash equivalents at end of period$102,064  $73,219  
See accompanying Notes to Condensed Consolidated Financial Statements

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)


1. Financial Statement Presentation
In the opinion of management, the accompanying consolidated financial statements of NewMarket Corporation and its subsidiaries contain all necessary adjustments for the fair presentation of, in all material respects, our consolidated financial position as of June 30, 2020 and December 31, 2019, and our consolidated results of operations, comprehensive income, and changes in shareholders' equity for the second quarter and six months ended June 30, 2020 and June 30, 2019, and our cash flows for the six months ended June 30, 2020 and June 30, 2019. All adjustments are of a normal, recurring nature, unless otherwise disclosed. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the NewMarket Corporation Annual Report on Form 10-K for the year ended December 31, 2019 (2019 Annual Report), as filed with the Securities and Exchange Commission (SEC). The results of operations for the six month period ended June 30, 2020 are not necessarily indicative of the results to be expected for the full year ending December 31, 2020. The December 31, 2019 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.
Unless the context otherwise indicates, all references to “we,” “us,” “our,” the “company,” and “NewMarket” are to NewMarket Corporation and its consolidated subsidiaries.
We adopted Accounting Standard Update No. 2016-13, "Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments" (ASU 2016-13) on January 1, 2020. ASU 2016-13 mandates a methodology be utilized that determines expected credit losses on financial instruments instead of the former methodology that delayed recognition until a probable loss had been incurred.
We record our accounts receivable at amortized cost and at the net amount expected to be collected. Our accounts receivable are predominantly trade receivables and are derived through the sale of petroleum additives products. Our customers primarily consist of global, national, and independent oil companies. We maintain an allowance for credit losses for expected losses resulting from our customers not making required payments. We determine the adequacy of the allowance by periodically evaluating each customer’s receivable balance, considering their financial condition and credit history, and considering current and forecasted economic conditions. The allowance for credit losses was not material at June 30, 2020 or December 31, 2019.

2. Net Sales

Our revenues are primarily derived from the manufacture and sale of petroleum additives products. We sell petroleum additives products across the world to customers located in the North America, Latin America, Asia Pacific, and Europe/Middle East/Africa/India regions. Our customers primarily consist of global, national, and independent oil companies. Our contracts generally include one performance obligation, which is providing petroleum additives products. The performance obligation is satisfied at a point in time when products are shipped, delivered, or consumed by the customer, depending on the underlying contracts.
In limited cases, we collect funds in advance of shipping product to our customers and recognizing the related revenue. These prepayments from customers are recorded as a contract liability to our customer until we recognize the revenue. Some of our contracts include variable consideration in the form of rebates or business development funds. We regularly review both rebates and business development funds and make adjustments when necessary, recognizing the full amount of any adjustment in the period identified.

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NEWMARKET CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

The following table provides information on our net sales by geographic area. Information on net sales by segment is in Note 3.
Second Quarter Ended
June 30,
Six Months Ended
June 30,
(in thousands)2020201920202019
Net sales
United States$119,928  $188,031  $301,772  $360,045  
China57,442  62,115  103,240  121,408  
Europe, Middle East, Africa, India130,944  178,593  321,567  346,912  
Asia Pacific, except China66,759  80,301  146,172  162,830  
Other foreign35,791  54,377  97,530  108,838  
Net sales $410,864  $563,417  $970,281  $1,100,033  
3. Segment Information
The tables below show our consolidated segment results. The “All other” category includes the operations of the antiknock compounds business, as well as certain contracted manufacturing and services associated with Ethyl Corporation (Ethyl).
Net Sales by Segment
Second Quarter Ended
June 30,
Six Months Ended
June 30,
(in thousands)2020201920202019
Petroleum additives
     Lubricant additives$343,418  $462,659  $807,104  $899,879  
     Fuel additives65,285  98,165  158,971  193,624  
          Total408,703  560,824  966,075  1,093,503  
All other2,161  2,593  4,206  6,530  
Net sales$410,864  $563,417  $970,281  $1,100,033  

Segment Operating Profit
Second Quarter Ended
June 30,
Six Months Ended
June 30,
(in thousands)2020201920202019
Petroleum additives$33,061  $102,992  $146,732  $190,855  
All other(399) (342) (64) 169  
Segment operating profit32,662  102,650  146,668  191,024  
Corporate, general, and administrative expenses(5,467) (4,275) (9,698) (9,369) 
Interest and financing expenses, net(7,005) (7,741) (14,109) (15,753) 
Other income (expense), net7,078  6,057  14,485  11,597  
Income before income tax expense
$27,268  $96,691  $137,346  $177,499  
 
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

4. Pension Plans and Other Postretirement Benefits
The table below shows cash contributions made during the six months ended June 30, 2020, as well as the remaining cash contributions we expect to make during the year ending December 31, 2020, for our domestic and foreign pension plans and domestic postretirement benefit plan.
(in thousands)Actual Cash Contributions for Six Months Ended June 30, 2020Expected Remaining Cash Contributions for Year Ending December 31, 2020
Domestic plans
Pension benefits$1,447  $2,893  
Postretirement benefits894  1,788  
Foreign plans
Pension benefits2,811  2,676  
The tables below present information on net periodic benefit cost (income) for our domestic and foreign pension plans and domestic postretirement benefit plan. The service cost component of net periodic benefit cost (income) is reflected in cost of goods sold; selling, general, and administrative expenses; or research, development, and testing expenses, to reflect where other compensation costs arising from services rendered by the pertinent employee are recorded on the Consolidated Statements of Income. The remaining components of net periodic benefit cost (income) are recorded in other income (expense), net on the Consolidated Statements of Income.
 Domestic
 Pension BenefitsPostretirement Benefits
Second Quarter Ended June 30,
(in thousands)2020201920202019
Service cost$4,198  $3,624  $217  $194  
Interest cost3,509  3,686  346  389  
Expected return on plan assets(9,306) (8,657) (241) (244) 
Amortization of prior service cost (credit)67  (19) (757) (757) 
Amortization of actuarial net (gain) loss1,316  854  0  0  
Net periodic benefit cost (income)$(216) $(512) $(435) $(418) 

 Domestic
 Pension BenefitsPostretirement Benefits
Six Months Ended June 30,
(in thousands)2020201920202019
Service cost$8,395  $7,247  $434  $388  
Interest cost7,017  7,371  691  778  
Expected return on plan assets(18,611) (17,314) (482) (488) 
Amortization of prior service cost (credit)133  (38) (1,514) (1,514) 
Amortization of actuarial net (gain) loss2,632  1,707  0  0  
Net periodic benefit cost (income)$(434) $(1,027) $(871) $(836) 
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

 Foreign
 Pension Benefits
Second Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2020