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Ingevity's (NGVT) Earnings and Revenues Lag Estimates in Q1

Ingevity Corporation NGVT recorded earnings of $1.35 per share in the first quarter of 2023 compared with $1.55 in the prior-year quarter.

Adjusted earnings in the reported quarter were $1.09 per share, down from $1.62 in the year-ago quarter. The figure missed the Zacks Consensus Estimate of $1.26.

The company’s revenues rose around 3% year over year to $392.6 million in the quarter, which lagged the Zacks Consensus Estimate of $410.2 million. The top line was driven by price increases across NGVT’s segments and contributions from the Ozark road markings business acquisition. These were partly offset by lower volumes in most business lines. NGVT witnessed continued destocking in certain product lines, particularly adhesives in its Industrial Specialties business.

 

Ingevity Corporation Price, Consensus and EPS Surprise

 

Ingevity Corporation Price, Consensus and EPS Surprise
Ingevity Corporation Price, Consensus and EPS Surprise

Ingevity Corporation price-consensus-eps-surprise-chart | Ingevity Corporation Quote

 

Segment Highlights

The Performance Chemicals division generated revenues of $185.6 million in the reported quarter, up around 8% year over year. Sales fell roughly 3% in Industrial Specialties while sales in Pavement Technologies went up roughly 64%.

Revenues in the Performance Materials unit fell 5% year over year to $141.4 million, primarily due to a slower recovery in automotive in China and currency headwinds, which offset higher prices and strong sales in North America.

The Advanced Polymer Technologies unit logged sales of $65.6 million, up 6% year over year. Higher prices across the segment and improved demand in automotive and bioplastics more than offset softer demand in Europe and customer destocking in Asia.

Financials

Ingevity ended the quarter with cash and cash equivalents of $77.9 million, down around 65% year over year. Long-term debt was $1,502.5 million, up around 59% year over year.

Operating cash flow was $5.2 million in the quarter. Free cash flow was a negative $20.2 million.

The company repurchased shares worth $33.4 million in the reported quarter.

Outlook

The company sees its sales for 2023 to the band of $1.75-$1.95 billion and adjusted EBITDA in the range of $450-$480 million.

Price Performance

Shares of Ingevity have lost 8.3% in a year against a 0.5% rise of the industry.

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Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

 

Zacks Rank & Other Key Picks

Ingevity currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks worth considering in the basic materials space include Steel Dynamics, Inc. STLD, PPG Industries, Inc. PPG and Linde plc LIN.

Steel Dynamics currently sports a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for STLD's current-year earnings has been revised 24.3% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 10.7%, on average. STLD has gained around 27% in a year.

PPG Industries currently carries a Zacks Rank #2. The Zacks Consensus Estimate for PPG's current-year earnings has been revised 11.7% upward in the past 60 days.

PPG Industries’ earnings beat the Zacks Consensus Estimate in three of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 6.8%, on average. PPG has gained around 9% in a year.

Linde currently carries a Zacks Rank #2. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 3.8% upward in the past 60 days.

Linde beat Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 5.9% on average. LIN’s shares have gained roughly 22% in the past year.

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Ingevity Corporation (NGVT) : Free Stock Analysis Report

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