Q3 2024 Ingevity Corp Earnings Call Transcript
Key Points
- Ingevity Corp (NGVT) achieved a higher gross margin by 610 basis points due to repositioning actions in performance chemicals.
- The company realized $18 million in savings during Q3, putting them on track to achieve their 2024 target of $65 million to $75 million in savings.
- Performance materials segment delivered solid sales growth of 3% and maintained high EBITDA margins, benefiting from lower input costs.
- Advanced Polymer Technologies (APT) saw a 14% increase in revenue, with signs of market demand improvement in China.
- Ingevity Corp (NGVT) generated free cash flow of $28.5 million in Q3, demonstrating strong cash generation capabilities.
- Third quarter sales were down 16% due to repositioning actions and unfavorable weather conditions affecting the Road Technologies product line.
- The company incurred significant restructuring charges of $86.9 million and a $100 million charge for terminating a long-term CTO supply contract, leading to a GAAP net loss of $107.2 million.
- Performance chemicals segment sales declined 31%, primarily due to repositioning actions and weak industrial demand.
- Ingevity Corp (NGVT) is still consuming high-cost CTO inventory, impacting EBITDA margins negatively.
- The company expects to deliver toward the lower end of their guidance due to headwinds like slow industrial demand and softening auto production forecasts.
Good morning or good afternoon, and welcome to the Ingevity third quarter 2024 earnings call and webcast. My name is Adam, and I'll be your operator today. (Operator Instructions)
I will now hand the floor to John Nypaver to begin. So John, please go ahead when you're ready.
Thank you, Adam. Good morning, and welcome to Ingevity's third quarter 2024 earnings call. Earlier this morning, we posted a presentation on our investor site that you can use to follow today's discussion. It can be found on ir.ingevity.com under Events & Presentations.
Also, throughout this call, we may refer to non-GAAP financial measures, which are intended to supplement, not substitute for comparable GAAP measures. Definitions of these non-GAAP financial measures and reconciliations to comparable GAAP measures are included in our earnings release and are also in our most recent Form 10-K.
We may also make forward-looking statements regarding future events and future financial
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