NewMarket Q2 net income rises to $133.8M, led by additives surcharges
NewMarket reported strong Q2 2026 results with net income rising to $133.8 million ($14.54 EPS) from $111.2 million ($11.84 EPS) in Q2 2025. First-half net income reached $251.8 million. Growth was fueled by pricing power in petroleum additives amidst supply chain disruptions and expanded specialty materials sales post-Calca acquisition.
*this image is generated using AI for illustrative purposes only.
NewMarket Corporation reported second quarter 2026 net income of $133.8 million, or $14.54 per share, compared to $111.2 million, or $11.84 per share, in the same period last year. For the first half of 2026, net income reached $251.8 million, or $27.14 per share, against $237.2 million, or $25.11 per share, in the corresponding 2025 period. The results reflect successful implementation of surcharges in the petroleum additives segment to offset supply chain disruptions and robust performance in specialty materials following the October 2025 acquisition of Calca Solutions, LLC.
Chairman and Chief Executive Officer Thomas E. Gottwald attributed the improvement in operating profit to surcharges implemented in response to higher costs from Middle East supply chain disruptions, alongside continued focus on operational efficiency. The company maintained these actions while monitoring uncertain macroeconomic conditions and international trade relations. Management stated that these measures position the company to deliver solid results despite a dynamic operating environment.
Petroleum additives sales rose to $675.6 million in the second quarter from $653.9 million year-earlier, with operating profit increasing to $149.4 million from $139.8 million. For the first half, petroleum additives sales remained flat at $1.3 billion, but operating profit improved slightly to $284.4 million from $281.9 million. Specialty materials sales surged to $67.2 million in the quarter from $42.0 million, driven by the inclusion of Calca’s results post-acquisition. First-half specialty materials sales totaled $125.3 million compared to $95.8 million previously.
| Metric | Q2 2026 | Q2 2025 | H1 2026 | H1 2025 |
|---|---|---|---|---|
| Net Sales | $747,094 thousand | $698,509 thousand | $1,416,811 thousand | $1,399,455 thousand |
| Net Income | $133,752 thousand | $111,244 thousand | $251,819 thousand | $237,193 thousand |
| EPS (Basic/Diluted) | $14.54 | $11.84 | $27.14 | $25.11 |
| Petroleum Additives Op Profit | $149,370 thousand | $139,835 thousand | $284,369 thousand | $281,942 thousand |
The company generated solid cash flow during the first half, funding capital expenditures of $51.7 million, paying dividends of $55.6 million, and repurchasing over 200 thousand shares for $126.4 million. These activities reduced the Net Debt to EBITDA ratio to 1.0x. NewMarket also declared cash dividends of $3.00 per share for the quarter, up from $2.75 in the prior year period. Total shareholders’ equity stood at $1,838,344 thousand as of June 30, 2026, compared to $1,778,243 thousand at year-end 2025.
What the Numbers Show
The divergence between flat first-half petroleum additives sales and rising operating profit highlights the effectiveness of NewMarket’s pricing strategy. While revenue remained static at $1.3 billion year-over-year, operating profit increased by $2.5 million, indicating margin expansion through surcharges rather than volume growth. This suggests the company successfully passed on higher raw material and logistics costs without losing market share, a critical capability given the ongoing supply chain disruptions in the Middle East region.
How sustainable are the current surcharges in the petroleum additives segment if Middle East supply chain disruptions persist into the second half of 2026?
What specific integration milestones does NewMarket anticipate for Calca Solutions to drive organic growth in the specialty materials segment beyond simple revenue inclusion?
Given the flat first-half sales volume in petroleum additives, is there a risk that prolonged price increases could trigger demand destruction or customer churn in the long term?
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