Valvoline Reports First-Quarter Results

Valvoline Reports First-Quarter Results

Retail services sales growth of 36% and a global products sales increase of 28% were among the highlights of the first-quarter report.

Valvoline Inc. reported financial results for its first fiscal quarter ended Dec. 31, 2021.

“Demand for Valvoline’s products and services remains robust, as we continue to gain share in both segments,” said Sam Mitchell, CEO. “Our team has done an outstanding job of helping to drive growth and meet demand, despite significant supply chain challenges.

“Topline growth in both segments was impressive with a 36% increase in sales for Retail Services and a 28% increase in sales for Global Products, highlighting a strong start to the fiscal year and a reflection of the health of both businesses. Retail Services operating income and adjusted EBITDA increased 45% and 40%, respectively, driven by topline growth and margin expansion. Global Products delivered strong volume growth of 13% and ongoing progress in price pass-through of raw material cost increases. Price-cost lag impacted profitability, which declined year-over-year. As we have done in the past, we expect to continue to pass-through pricing to recover our costs.

“Our results this quarter demonstrate that our business continues to perform well and highlight the independent strengths of both segments, as we make progress on the separation of these two strong businesses.” 

Operating Segment Results 

(In millions)
Retail ServicesQ1 resultsYoY growth
Segment sales$            34636    %
System-wide store sales (a)$            55131    %
Operating income$              8145    %
Adjusted EBITDA (a)$              9840    %
YoY growth 
System-wide SSS (a) growth24.7%
Global ProductsQ1 resultsYoY growth (decline)
Lubricant sales (gallons) (a)43.113    %
Segment sales$            51228    %
Operating income$              70(20)   %
Adjusted EBITDA (a)$              77(18)   %
Discretionary free cash flow (a)$              52(17)   %
(a)Refer to Key Business Measures, Use of Non-GAAP Measures, and Tables 4 and 5, Information by Operating Segment, for a description of the metrics presented above.

Balance Sheet and Cash Flow

  • Total debt of approximately $1.7 billion and net debt of approximately $1.5 billion
  • Cash flow from operations of $32 million and free cash flow of $(3) million
  • Returned $31 million of cash to shareholders via share repurchases and $23 million via dividends

Outlook

“We are making good progress on separation-related work, and we remain focused on the performance of the business and delivering results,” Mitchell said. “We are reaffirming our guidance, including exceptional topline growth and solid improvement in adjusted EBITDA. We continue to be pleased with strong demand in Global Products, as we navigate short-term supply-chain challenges. Retail Services topline performance remains strong as our algorithm of same-store sales growth and unit additions continues to deliver. We do expect our same-store sales to moderate as we compare against strong comps in the prior year. 

“As we did in Q1, we will continue to return cash to shareholders through dividends and share repurchases. We believe that the separation of our two businesses will enhance value for all of our stakeholders and expect to have more information to share in the coming months.” 

Information regarding the Company’s outlook for fiscal 2022 is provided in the table below: 

Updated OutlookPrior Outlook
Operating Items
Sales growth no change1921%
Retail Services system-wide store additionsno change110130
Retail Services system-wide SSS growthno change912%
Adjusted EBITDA no change$675$700 million
Corporate Items 
Adjusted effective tax rate 2425%2526%
Adjusted EPS $2.07$2.20$2.06$2.18
Capital expenditures no change$180$200 million
Free cash flow no change$260$300 million

Valvoline’s says its outlook for adjusted EBITDA, adjusted EPS and the adjusted effective tax rate are non-GAAP financial measures that are expected to be adjusted for items impacting comparability. Valvoline is unable to reconcile these forward-looking non-GAAP financial measures to the comparable GAAP measures estimated for fiscal 2022 without unreasonable efforts, as the company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact these GAAP measures in fiscal 2022 but would not impact non-GAAP adjusted results.

You May Also Like

MPA Reports Strong Financial Results for Fiscal Q3 2024

MPA’s Q3 results showed increases in net sales, operating income and cash flow from operating activities.

Motorcar Parts of America, Inc. released its financial results for the fiscal 2024 third quarter and nine-month period ending December 31, 2023, showcasing increases in net sales, operating income and cash flow from operating activities.

During the fiscal third quarter, net sales surged by 13.2 percent to $171.9 million, accompanied by a substantial improvement in gross margin by 3.7 percentage points. Gross profit increased by 43.1 percent to $30 million, while operating income increased 170.1 percent to $9.5 million. The company generated approximately $53.6 million in cash from operating activities during the quarter, according to MPA's earnings report.

O’Reilly Reports Q4, Full-Year 2023 Financial Results

The company said it anticipates continued growth in 2024, with projections including 190 to 200 net new store openings.

financial results
Valvoline, Inc. Reports Q1 Growth

Valvoline saw an increase in system-wide stores to 1,890, including 895 company-operated stores and 995 franchised stores in Q1.

Valvoline Instant Oil Change building
Eaton Reports Record Q4 2023 Results

Fourth-quarter sales reached $6 billion, an 11% increase from the previous year, driven by organic growth and a slight boost from foreign exchange.

PACCAR Achieves Record Annual Revenues, Net Income

PACCAR Parts reported a record annual pre-tax income of $1.7 billion and revenues of $6.41 billion.

Financial-results

Other Posts

Valvoline Celebrates Female Service Center Employees

Valvoline is launching a social media campaign led by its female experts who are sharing automotive preventive maintenance tips to promote accessible vehicle care for all.

Forvia Reports FY 2023 Results After HELLA Acquisition

The company reported synergies with HELLA, with cumulative net cost synergies reaching over $200 million by the end of 2023.

Valvoline Global to Debut Ad During Super Bowl Pre-Game

The company will showcase its Restore & Protect motor oil in a 30-second ad before Super Bowl LVIII.

Valvoline-Restore-and-Protect
The Bosch Group Achieves Sales Growth in 2023 Amid Challenges

In response to automotive industry changes, Bosch announced the largest realignment of its core business, establishing the integrated Mobility business sector.