Profits were up for Fuchs, Milacron and S-Oil, while SK Lubricants reported decreased operating profit, Valvoline posted a decline in operating income and Quaker Chemical reported decreased net income, all for the quarter ending June 30, compared to a year earlier.
S-Oils lubricant base oil segment reported second quarter operating income of 129.4 billion South Korean won (U.S. $115.5 million), a modest increase from last years 128.1 billion won.
Revenue jumped 17.3 percent to 405.8 billion won from 345.8 billion won for the same period last year.
The improved lube base oil margin in [the second quarter] is likely to be sustained thanks to limited capacity addition in 2017 and the demand growth for high-quality products in the U.S. and Europe, the company said in its earnings release.
SK Lubricants reported a 9.8 percent decrease in operating profit from 133 billion won (U.S. $118.7 million) to 120 billion won for its second quarter.
The company posted an increase of almost 16 percent in sales from last years 653.3 billion won to 757 billion won. In the second quarter, the base oil spread continued to trend upward, owing to the coming of the high season and a supply decrease from the Middle East and other regions, Cha Jin-seok, chief financial officer for Seoul-based parent company SK Innovation, said in an earnings conference call.
Mannheim, Germany-based Fuchs Petrolub SE reported 67.5 million (U.S. $79.7 million) in earnings after tax, a 0.5 percent decrease from the same quarter last year. Sales revenue, however, grew 7.3 percent to 628.8 million.
The independent lubricants blender experienced the most growth in Asia-Pacific and Africa, where sales revenue jumped 18.8 percent to 182.9 million. Strong growth in sales revenues was recorded in China, while Australia and South Africa saw a considerable increase as well, the earnings release noted.
The Americas followed close behind, reporting a sales revenue of 100.9 million, up 15.5 percent from last years second quarter. Sales revenue in Europe increased 3.1 percent to 383 million from 371.5 million during the year-earlier period.
Valvoline Inc.s operating income dropped roughly 8 percent to $104 million for its three operating segments – North America, quick lubes and international – for the companys fiscal quarter ending June 30.
The three segments reported total sales of $534 million, up 7 percent from $499 million in the same period last year. The core North America segment accounted for roughly 48 percent, quick lubes for 26 percent and international sales for 26 percent.
North American lubricant sales experienced a marginal jump of less than 3 percent from last years $251 million to $258 million. The lag between raw material cost increases and planned price increases had a significant year-over-year impact on the segment’s profitability, with a favorable impact in prior year and a negative impact this year, the Lexington, Kentucky-based company said in an earnings report.
Quick lube segment sales jumped 16.8 percent to $139 million, driven in part by new marketing programs, and international lubricants sales grew 6.2 percent to $137 million for the companys third quarter.
In September 2015, Ashland announced it would spin off Valvoline, allowing the company to become an independent, publically owned company. On May 12, Ashland distributed its 170 million-share ownership in Valvoline to its shareholders, marking the final step in Valvolines separation from Ashland.
Conshohoken, Pennsylvania-based Quaker Chemicals net income fell to $11.9 million in the second quarter, a 20 percent decrease from $15 million in the year-earlier period. Net sales for the metalworking fluid supplier grew 8 percent to $201.2 million, driven by organic and acquisition volume growth.
Quaker Chemical previously secured $1.2 billion in commitments from two banks to fund its acquisition of Houghton Chemical, but replaced the commitments with a syndicated bank agreement with customary terms and conditions as of June 20, 2017. According to Quakers earnings news release, the deal is still on track to close either in the fourth quarter of 2017 or the first quarter of 2018.
“We are pleased with our second quarter results, despite higher raw material costs which continued to increase more than we had expected in the quarter. We were able to grow our organic volumes by 5 percent on continued market share gains, as well as from increased production in some of our end markets, said Michael F. Barry, chairman, CEO and president of Quaker, in the earnings release.
Milacrons industrial segment – which supplies metalworking and industrial fluids – posted operating earnings of $5.5 million for the second quarter, a 10 percent increase from the same period last year.
The Cincinnati-based company reported an increase in sales to $30.5 million, up 6.7 percent from $28.6 million a year earlier.