Financial Performance - Net sales from continuing operations were $333.1 million, flat compared to the prior year[4] - Total net sales, including discontinued operations, were $362.1 million, down 4% year-over-year[7] - Total adjusted EBITDA increased 14% to $121.2 million, with a margin improvement to 33.5%[7] - Performance Materials sales increased 3% to $155.0 million, driven by volume growth from improved global auto production[9] - Advanced Polymer Technologies sales declined by $10.6 million to $38.2 million due to indirect tariff impacts and weak industrial demand[10] - Performance Chemicals sales from continuing operations were $139.9 million, up nearly 5% due to record pavement sales in North America[11] - Net sales for Q3 2025 were $333.1 million, a slight decrease of 0.2% compared to $333.8 million in Q3 2024[21] - Gross profit increased to $133.9 million in Q3 2025, up 1.7% from $131.6 million in Q3 2024[21] - Net income from continuing operations for Q3 2025 was $40.8 million, down 14.1% from $47.5 million in Q3 2024[21] - Basic earnings per share from continuing operations decreased to $1.12 in Q3 2025, down from $1.31 in Q3 2024[21] - Performance Materials segment net sales were $155.0 million in Q3 2025, an increase of 2.6% from $151.1 million in Q3 2024[23] - Performance Chemicals segment net sales increased to $139.9 million in Q3 2025, up from $133.9 million in Q3 2024, representing a 4.5% growth[23] - Advanced Polymer Technologies segment net sales decreased to $38.2 million in Q3 2025, down 21.4% from $48.8 million in Q3 2024[23] - Total adjusted earnings for Q3 2025 were $56.3 million, up from $40.2 million in Q3 2024, representing an increase of approximately 40.5%[60] - The diluted adjusted earnings per share from continuing operations for Q3 2025 was $1.31, slightly down from $1.33 in Q3 2024[62] - The total diluted adjusted earnings per share for the nine months ended September 30, 2025 was $3.90, compared to $2.56 for the same period in 2024, indicating a significant increase of approximately 52.3%[62] Cash Flow and Debt Management - Operating cash flow was $129.7 million, with strong free cash flow of $117.8 million enabling $25 million in share repurchases[12] - Cash provided by operating activities increased to $129.7 million for the three months ended September 30, 2025, compared to $46.5 million in the same period of 2024, marking an increase of 178.5%[37] - Free cash flow for Q3 2025 was $117.8 million, significantly higher than $28.5 million in Q3 2024, with a total free cash flow of $200.0 million for the nine months ended September 30, 2025, compared to $11.4 million in the same period of 2024[70] - Long-term debt, including finance lease obligations, decreased from $1,339.7 million on December 31, 2024, to $1,158.5 million on September 30, 2025, a reduction of approximately 13.5%[35] - Cash paid for interest decreased to $13.5 million for the three months ended September 30, 2025, down from $18.7 million in the same period of 2024[39] - The net debt ratio as of September 30, 2025, was 2.7x, calculated using total adjusted EBITDA of $403.1 million for the last twelve months[72] Strategic Decisions and Future Outlook - Full-year guidance revised to total net sales between $1.25 billion and $1.35 billion and total adjusted EBITDA between $390 million and $405 million[13] - The company announced the sale of the majority of the Industrial Specialties product line and North Charleston crude tall oil refinery for $110 million, expected to close by early 2026[7] - The company plans to continue focusing on strategic investments to enhance its market position and operational efficiency[41] - The company is expected to continue its strategic investments and market expansion efforts, although specific future guidance was not detailed in the provided content[68] Impairments and Charges - The company reported a significant goodwill impairment charge of $183.8 million for the nine months ended September 30, 2025[37] - The company reported a goodwill impairment charge of $183.8 million for the nine months ended September 30, 2025, compared to $306.6 million for the same period in 2024[60] - Restructuring and other charges for Q3 2025 amounted to $1.0 million, down from $3.3 million in Q3 2024[63] - The company incurred $10.1 million in restructuring and other charges for the nine months ended September 30, 2025, compared to $8.3 million in the same period of 2024[63] Tax and Non-GAAP Adjustments - The tax effect on non-GAAP adjustments for the nine months ended September 30, 2025 was $51.2 million, compared to $74.2 million for the same period in 2024[60] - The company anticipates variability in projected effective tax rates due to discrete tax items and other components impacting financial measures[57] - The company does not provide a reconciliation of net income to Total Adjusted EBITDA for 2025 due to the uncertainty in estimating various components of net income[57]

Core Insights - The London Company Small Cap Strategy reported a 1.9% appreciation in its small-cap portfolio for Q3 2025, underperforming the Russell 2000 Index which gained 12.4% [1] - The report highlighted Ingevity Corporation (NYSE:NGVT) as a key holding, noting its significant margin recovery and performance improvements in the Performance Chemicals segment [3] Company Performance - Ingevity Corporation's stock closed at $53.84 on November 3, 2025, with a market capitalization of $1.963 billion [2] - The company achieved a one-month return of 0.71% and a 52-week gain of 24.11% [2] - Ingevity Corporation outperformed its benchmark due to a recovery in margins and strategic portfolio shifts, despite facing a cyclical downturn [3] Hedge Fund Interest - Ingevity Corporation was held by 25 hedge fund portfolios at the end of Q2 2025, an increase from 22 in the previous quarter [4] - While the company shows potential, the report suggests that certain AI stocks may offer greater upside potential with less downside risk [4]

Core Viewpoint - Ingevity Corporation has appointed Ruth Castillo as president of its Performance Materials segment, effective November 10, 2025, to drive innovation and strategic growth in its activated carbon portfolio [1][12]. Group 1: Leadership Appointment - Ruth Castillo brings over 25 years of global experience in the chemicals and materials industries, previously serving as vice president of global chemicals at Avantor [2][4]. - Castillo has a proven track record in driving innovation, operational excellence, and strategic growth, having led high-value portfolios at companies like Avantor and Celanese [2][4]. - Ingevity's CEO, Dave Li, emphasized Castillo's strategic and innovation-focused leadership style, which aligns with the company's market-driven priorities [3]. Group 2: Company Overview - Ingevity specializes in products and technologies that purify, protect, and enhance the environment, operating in three segments: Performance Materials, Advanced Polymer Technologies, and Performance Chemicals [5]. - The Performance Materials segment includes activated carbon, which is crucial for applications such as evaporative emissions control [2][5]. - The company is headquartered in North Charleston, South Carolina, and employs approximately 1,600 people across 24 locations globally [6].

Core Viewpoint - Ingevity Corporation (NGVT) has agreed to divest its North Charleston crude tall oil (CTO) refinery assets and the majority of its Performance Chemicals Industrial Specialties product line to Mainstream Pine Products, LLC [1][9] Financial Impact - The transaction is expected to generate approximately $110 million in cash proceeds, with a contingent payment ranging from $0 to $19 million based on future business performance [2][9] - Adjusted EBITDA guidance has been reaffirmed to be between $390 million and $415 million, while sales estimates remain between $1.25 billion and $1.40 billion [5] Strategic Objectives - The divestiture aims to reduce portfolio volatility, strengthen margin and cash flow profile, and enhance future strategic optionality [3][9] - The cash proceeds will facilitate deleveraging and provide more flexibility in future capital allocation decisions [3] Operational Considerations - The sale will not impact the production of the Road Technologies product line or the lignin-based dispersants manufactured at the North Charleston plant [4] - NGVT will enter into arrangements with Mainstream, including supplying certain refinery products and collaborating on toll manufacturing and plant operating services [4] Market Performance - NGVT stock has increased by 76.7% over the past year, contrasting with a 0.4% decline in the industry [6]

Core Viewpoint - Ingevity's recent earnings report shows a mixed performance with a significant loss but improved adjusted earnings, raising questions about future trends leading up to the next earnings release [1][2]. Financial Performance - Ingevity reported a Q2 2025 loss of $146.5 million or $4.02 per share, an improvement from a loss of $283.7 million or $7.81 per share in the same quarter last year [2]. - Adjusted earnings were $1.39 per share, up from $1.01 a year ago, surpassing the Zacks Consensus Estimate of $1.02 per share [2]. - Revenues declined 6.5% year over year to $365.1 million, primarily due to lower sales in the Performance Chemicals segment [3]. Segmental Review - The Performance Chemicals division generated revenues of $167.9 million, down 9.5% year over year, with Road Technologies' sales at $119.5 million, down 7.4%, and Industrial Specialties' sales at $48.4 million, down 14.2% [4]. - Performance Materials revenues fell 2.1% to $153.9 million, affected by lower sales in Asia and Europe, while North America saw higher sales [5]. - Advanced Polymer Technologies segment sales decreased 9.6% to $43.3 million due to reduced customer demand, particularly in Europe [6]. Financial Metrics - Operating cash flow for Q2 was $79 million, with free cash flow of $66.8 million, and no share repurchases during the quarter [7]. - Net leverage improved to 3x from 3.3x in the previous quarter [7]. 2025 Outlook - Ingevity revised its EBITDA guidance upward, now expecting adjusted EBITDA between $390 million and $415 million, compared to the previous range of $380-$415 million [8]. - Sales estimates remain between $1.25 billion and $1.40 billion [8]. Analyst Sentiment - Analysts have not made any earnings estimate revisions in the past two months, indicating a period of stability in expectations [9]. Investment Scores - Ingevity has a Growth Score of A but a low Momentum Score of F, resulting in an aggregate VGM Score of B [10]. Industry Context - Ingevity operates within the Zacks Chemical - Specialty industry, where competitor Element Solutions reported revenues of $625.2 million, reflecting a year-over-year increase of 2% [12].

Core Insights - Ingevity Corporation (NGVT) reported a second-quarter 2025 loss of $146.5 million or $4.02 per share, an improvement from a loss of $283.7 million or $7.81 per share in the same quarter last year [1] - Adjusted earnings for the quarter were $1.39 per share, up from $1.01 a year ago, surpassing the Zacks Consensus Estimate of $1.02 per share [1][9] - Revenues decreased by 6.5% year over year to $365.1 million, primarily due to lower sales in the Performance Chemicals segment [2] Segment Performance - The Performance Chemicals division generated revenues of $167.9 million, down approximately 9.5% year over year, with Road Technologies sales at $119.5 million (down 7.4%) and Industrial Specialties at $48.4 million (down 14.2%) [3] - EBITDA for the Performance Chemicals segment increased by 244% to $32 million, attributed to successful repositioning and cost savings [3] - Performance Materials revenues fell by 2.1% year over year to $153.9 million, impacted by lower sales in Asia and Europe, while North America saw higher sales; segment EBITDA was $77.1 million, down 6.2% [4] - Advanced Polymer Technologies segment sales decreased by 9.6% to $43.3 million due to reduced customer demand, particularly in Europe, with segment EBITDA down 90.8% to $0.9 million [5] Financial Overview - Operating cash flow for the second quarter was $79 million, with free cash flow of $66.8 million; no share repurchases occurred during the quarter, leaving $353.4 million remaining under the current $500 million authorization [6] - Net leverage improved to 3x from 3.3x in the previous quarter [6] 2025 Outlook - NGVT has revised its 2025 EBITDA guidance upwards, now expecting adjusted EBITDA between $390 million and $415 million, compared to the previous range of $380 million to $415 million; sales estimates remain between $1.25 billion and $1.40 billion [7][9] Stock Performance - NGVT shares have increased by 50.8% over the past year, outperforming the industry average increase of 1.2% [8]

PART I - FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company reported a reduced net loss of $146.5 million in Q2 2025, with total assets at $1.88 billion and operating cash flow improving to $104.4 million [Condensed Consolidated Statements of Operations](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net sales for Q2 2025 decreased to $365.1 million from $390.6 million in Q2 2024, while gross profit increased to $137.9 million, leading to a net loss of $146.5 million | Financial Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $365.1 M | $390.6 M | $649.1 M | $730.7 M | | **Gross profit** | $137.9 M | $123.2 M | $251.3 M | $222.9 M | | **Goodwill impairment charge** | $183.8 M | $349.1 M | $183.8 M | $349.1 M | | **Net income (loss)** | $(146.5) M | $(283.7) M | $(126.0) M | $(339.7) M | | **Diluted earnings (loss) per share** | $(4.02) | $(7.81) | $(3.46) | $(9.36) | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets decreased to $1,877.7 million, primarily due to a goodwill impairment, with total liabilities at $1,757.0 million and total equity at $120.7 million | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $76.9 M | $68.0 M | | **Goodwill** | $4.3 M | $175.2 M | | **Total Assets** | $1,877.7 M | $2,022.6 M | | **Long-term debt** | $1,235.6 M | $1,339.7 M | | **Total Liabilities** | $1,757.0 M | $1,827.4 M | | **Total Equity** | $120.7 M | $195.2 M | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities significantly improved to $104.4 million for the six months ended June 30, 2025, while investing activities decreased and financing activities reflected net debt payments | Cash Flow Activity (Six Months Ended June 30) | 2025 | 2024 | | :--- | :--- | :--- | | **Net cash provided by (used in) operating activities** | $104.4 M | $17.6 M | | **Net cash provided by (used in) investing activities** | $(14.3) M | $(34.1) M | | **Net cash provided by (used in) financing activities** | $(74.0) M | $33.7 M | | **Change in cash, cash equivalents, and restricted cash** | $20.5 M | $13.4 M | [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes detail a **$183.8 million** goodwill impairment charge, ongoing Performance Chemicals repositioning with **$335.1 million** incurred, and an accrued **$93.4 million** for a BASF jury verdict under appeal - A non-cash goodwill impairment charge of **$183.8 million** was recorded for the Advanced Polymer Technologies (APT) reporting unit in Q2 2025, representing all goodwill associated with the unit. This was triggered by escalated global trade tensions, increased consumer uncertainty, and unfavorable movements in valuation inputs like the discount rate[58](index=58&type=chunk)[60](index=60&type=chunk) - The company expects to incur total charges of approximately **$365 million** for the Performance Chemicals repositioning. Through June 30, 2025, **$335.1 million** has been incurred, with an expected **$10 to $15 million** in cash charges remaining for 2025[106](index=106&type=chunk)[107](index=107&type=chunk) - The company is appealing a jury verdict in favor of BASF, for which it has accrued **$93.4 million** as of June 30, 2025, inclusive of post-judgment interest. A final resolution of the appeals is expected within twelve months[131](index=131&type=chunk)[132](index=132&type=chunk) | Segment Net Sales (in millions) | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--- | :--- | :--- | :--- | :--- | | **Performance Materials** | $153.9 | $157.2 | $300.7 | $302.3 | | **Performance Chemicals** | $167.9 | $185.5 | $262.9 | $332.5 | | **Advanced Polymer Tech.** | $43.3 | $47.9 | $85.5 | $95.9 | | **Total Net Sales** | $365.1 | $390.6 | $649.1 | $730.7 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 net sales declined 6.5% due to repositioning, while gross profit improved, and 2025 Adjusted EBITDA outlook was revised - The company reaffirmed its 2025 sales outlook of **$1.25 billion to $1.4 billion**[230](index=230&type=chunk) - The Adjusted EBITDA outlook for 2025 was revised to a range of **$390 million to $415 million**, reflecting improved profitability in the Performance Chemicals segment and current forecasts for North American light vehicle production[232](index=232&type=chunk) - The Performance Chemicals repositioning, initiated in November 2023, has resulted in total realized cash savings of approximately **$103 million** as of June 30, 2025[173](index=173&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Q2 2025 net sales decreased by $25.5 million due to volume decline, while gross profit increased by $14.7 million from lower manufacturing costs and a LIFO liquidation benefit | Net Sales Variance (Q2 2025 vs Q2 2024) | Amount (in millions) | | :--- | :--- | | **Volume** | $(37.6) | | **Price/Mix** | $10.5 | | **Currency Effect** | $1.6 | | **Total Change** | $(25.5) | - Q2 2025 gross profit increased by $14.7 million, driven by favorable pricing/mix ($11.4M), decreased manufacturing costs ($11.2M), and a LIFO liquidation benefit ($4.1M), which offset unfavorable sales volume ($11.5M)[182](index=182&type=chunk) [Segment Operating Results](index=35&type=section&id=Segment%20Operating%20Results) In Q2 2025, Performance Materials saw sales and EBITDA decline, Performance Chemicals' sales fell but EBITDA surged, and Advanced Polymer Technologies experienced significant sales and EBITDA drops | Segment EBITDA (in millions) | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Performance Materials** | $77.1 | $82.2 | (6.2%) | | **Performance Chemicals** | $32.0 | $9.3 | +244.1% | | **Advanced Polymer Technologies** | $0.9 | $9.8 | (90.8%) | | **Total Segment EBITDA** | $110.0 | $101.3 | +8.6% | [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) Operating cash flow significantly increased to $104.4 million for the first six months of 2025, with **$400.0 million** available under the revolving credit facility and projected capital expenditures of **$50-70 million** for 2025 - As of June 30, 2025, the company had **$400.0 million** of undrawn capacity under its revolving credit facility[240](index=240&type=chunk) - Projected capital expenditures for the full year 2025 are estimated to be between **$50 million and $70 million**[246](index=246&type=chunk) - No common stock was repurchased during the six months ended June 30, 2025. At quarter-end, **$353.4 million** remained available under the 2022 share repurchase authorization[245](index=245&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency, interest rates, and commodity prices, with CTO risk significantly reduced post-repositioning - The company's exposure to Crude Tall Oil (CTO) price risk has been significantly reduced following the Performance Chemicals repositioning and termination of a long-term supply contract[260](index=260&type=chunk) - As of June 30, 2025, approximately **$485 million** of borrowings have a variable interest rate component. A hypothetical **100 basis point** increase in rates would increase annual interest expense by about **$4.8 million**[258](index=258&type=chunk) [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[264](index=264&type=chunk) - No changes occurred during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[264](index=264&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company is appealing a jury verdict in favor of BASF Corporation, for which it has accrued $85.0 million, as detailed in Note 13 - The company is involved in a legal proceeding with BASF Corporation and has accrued for the full amount of the jury's verdict. The case is currently under appeal. Details are provided in Note 13[129](index=129&type=chunk)[131](index=131&type=chunk)[267](index=267&type=chunk) [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) Risk factors remain largely unchanged, with new emphasis on tariffs and potential disruptions at key single-site manufacturing facilities - Recent changes to U.S. and international tariffs, particularly with China, are expected to make it more difficult or costly to export products and import raw materials, potentially reducing demand and profitability[269](index=269&type=chunk) - The company faces risk from potential disruptions at its manufacturing facilities, noting that certain key products are made only at a single site, such as the Covington, Virginia plant, with limited ability to shift production elsewhere[272](index=272&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common stock was repurchased in Q2 2025, with **$353.4 million** remaining available under the 2022 share repurchase authorization - No shares of common stock were repurchased by the company during the three months ended June 30, 2025[273](index=273&type=chunk)[275](index=275&type=chunk) - Approximately **$353.4 million** remains available for repurchase under the 2022 share repurchase authorization as of June 30, 2025[275](index=275&type=chunk) [Exhibits](index=49&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including employee stock plans, a separation agreement, and CEO/CFO certifications

Financial Data and Key Metrics Changes - Second quarter sales were $365 million, down 7% year-over-year primarily due to repositioning actions in Industrial Specialties and adverse weather conditions affecting paving activity [7][8] - Adjusted gross margin improved by 600 basis points, leading to a 9% increase in adjusted gross profit, with adjusted earnings up 39% and adjusted EBITDA up 9% [7][8] - Consolidated EBITDA margin reached 30.1%, an improvement of over 400 basis points, despite increased spending for innovation and operational efficiency [8][9] Business Line Data and Key Metrics Changes - Performance Materials sales declined by approximately $3 million or 2%, with higher revenue in North America offset by declines in Europe and Asia [10] - APT segment experienced a 10% drop in sales due to weaker customer demand and indirect tariff impacts, resulting in an EBITDA of about $1 million for the quarter [12][14] - Performance Chemicals sales were down about 10%, but segment EBITDA was more than three times last year's number, with EBITDA margin approaching 20% [15][17] Market Data and Key Metrics Changes - Auto production forecasts have been revised, with expectations for lower production year-over-year in all major markets except China [11] - The APT segment's performance was significantly impacted by tariff uncertainty, particularly in Europe, affecting customer order patterns [13] - The paving season was negatively impacted by wet weather, but there was strong performance in June and July, leading to cautious optimism for the second half [15][17] Company Strategy and Development Direction - The company is advancing its strategic portfolio assessment, with the sale process for the Industrial Specialties business and CTO Refinery in an advanced stage [5][19] - A focus on core competencies and value creation is guiding the review of the entire portfolio, with an investor update expected later this year or early next year [19][37] - The company aims to maintain strong EBITDA margins and free cash flow while navigating macroeconomic uncertainties [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a year-end net leverage target of below 2.8 times, supported by strong free cash flow and improved earnings [18][19] - The company has seen three consecutive quarters of year-over-year improvement in EBITDA and free cash flow, indicating a positive trend [19] - Management acknowledged the challenges posed by macroeconomic factors but remains optimistic about the company's strategic direction and execution [19] Other Important Information - A noncash goodwill impairment charge of $184 million was recorded for the APT segment due to shifts in customer order patterns and market conditions [8] - The company is experiencing improved cash flow due to disciplined working capital management and lower CapEx, raising the midpoint of its free cash flow guidance [9][18] Q&A Session Summary Question: Update on inspectors' standalone ex payment and CCO prices - Management indicated they do not break out profitability but suggested looking at seasonal profitability comparisons [21] Question: Investments mentioned in prepared remarks - Management highlighted ongoing investments in partnerships, particularly in the EV segment and process purification applications [23][25] Question: Thoughts on leadership changes in the segment - Management confirmed an active search for new leadership and ongoing internal momentum to reorganize the business [26][27] Question: Performance Chemicals margin insights - Management noted that the second half margins are expected to be similar to the first half, without the drag from high-cost CTO [29][31] Question: Drivers of improved free cash flow - Management attributed improved free cash flow to better earnings and inventory management initiatives [32][33] Question: Strategic review process for the portfolio - Management confirmed that the review is ongoing and will consider core competencies and growth opportunities [35][37] Question: CTO pricing and market conditions - Management stated that current CTO prices are lower than previous high costs, and they are less dependent on market fluctuations [39][41] Question: Performance Materials pricing resilience - Management emphasized the value provided to customers, which has allowed for consistent pricing despite volume declines [43][44] Question: Assessment of Advanced Polymer Technologies segment - Management acknowledged new leadership and ongoing portfolio review, indicating potential for future growth [46][48] Question: Future cash deployment strategies - Management indicated priorities include organic investments, share repurchases, and potential M&A opportunities once leverage targets are met [50][51]

Core Viewpoint - Ingevity's shares have increased by approximately 6.4% since the last earnings report, but this performance is below that of the S&P 500 index [1]. Group 1: Recent Performance - The stock has underperformed relative to the S&P 500 over the past month [1]. - There is uncertainty regarding whether the positive trend will continue or if a pullback is imminent before the next earnings release [1]. Group 2: Analyst Activity - Analysts have not made any earnings estimate revisions in the last two months, indicating a period of quiet regarding expectations for the company [2].

Core Insights - Ingevity Corporation (NGVT) reported a first-quarter 2025 profit of $20.5 million or 56 cents per share, a significant improvement from a loss of $56 million or $1.54 per share in the same quarter last year [1] - Adjusted earnings for the quarter were 99 cents per share, up from 47 cents a year ago, excluding one-time items [1] Revenue Performance - Revenues decreased by 16.5% year over year to $284 million, primarily due to lower sales in the Industrial Specialties product line and the Advanced Polymer Technologies segment [2] - The Performance Chemicals division generated revenues of $95 million, down approximately 35.4% year over year [2] - Road Technologies' product line sales were $44.3 million, down 3% [2] - Industrial Specialties' product line sales fell 50% to $50.7 million due to repositioning measures aimed at exiting lower-margin markets [2] - Performance Materials unit revenues rose around 1.2% year over year to $146.8 million, driven by volume growth in the Asia Pacific region and China [3] - Advanced Polymer Technologies segment sales decreased by 12.1% to $42.2 million, with EBITDA up 31.6% to $12.5 million due to higher utilization rates [4] Financial Metrics - First-quarter operating cash flow was $25.4 million, with free cash flow of $15.4 million [5] - No share repurchases occurred during the quarter, leaving $353.4 million remaining under the current $500 million authorization [5] - Net leverage improved to 3.3x from 3.6x in the previous quarter [5] 2025 Outlook - NGVT revised its 2025 guidance to account for potential risks from lower expected global auto production, projecting sales between $1.25 billion and $1.40 billion and adjusted EBITDA between $380 million and $415 million [6] Stock Performance - NGVT shares have declined by 26.1% over the past year, compared to a 3.1% decline in the industry [7]