Valvoline Inc. has reported financial results for its second fiscal quarter ended March 31, 2018.
Reported second quarter 2018 net income and EPS were $67 million and 33 cents, respectively. These results included after-tax income of $7 million (3 cents per diluted share) related to non-service pension and other post-employment benefit (OPEB) income and after-tax expenses of $6 million (3 cents per diluted share) for legacy and other separation-related costs and $2 million (1 cent per diluted share) related to U.S. tax reform.
Reported second quarter 2017 net income and EPS were $71 million and 35 cents, respectively, which included after-tax income of $10 million (5 cents per diluted share) related to non-service pension and OPEB income and after-tax expenses of $4 million (2 cents per diluted share) for legacy and other separation-related costs.
Adjusted second quarter 2018 net income and adjusted EPS, excluding the impact of tax reform, pension income and legacy and other separation-related costs, were $68 million and 34 cents, respectively, compared to adjusted net income of $65 million and adjusted EPS of 32 cents in the prior year period.
The company said second quarter results were driven by the ongoing strength of SSS in VIOC and strong margin and joint venture performance in International, which were partially offset by weaker Core North America branded volumes and margin. Adjusted EBITDA of $122 million grew 6 percent compared to the prior year period.
“Overall performance in the second quarter was in line with our expectations,” said CEO Sam Mitchell. “The benefit of our multi-channel model was evident in the quarter with strong performance in Quick Lubes and International, offsetting results in Core North America where short-term margin pressure negatively impacted profitability.
“In keeping with our capital allocation framework, we returned $102 million of cash to shareholders through dividends and share repurchases during the quarter.”
Fiscal 2018 Outlook
“We anticipate strong volume and SSS growth in the second half,” said Mitchell. “We are narrowing our fiscal 2018 Adjusted EBITDA guidance to $480 million to $490 million, which reflects the modest negative impact of the current raw material cost environment. We expect our Quick Lubes and International businesses to continue their momentum, and we have initiatives in place which we believe will drive improved results in Core North America.”