Ingevity provides update in light of coronavirus (COVID-19)
March 23 2020 - 6:15AM
Business Wire
Ingevity Corporation (NYSE:NGVT) today announced some of the
steps it is taking on various levels to address and mitigate the
impacts of the coronavirus (COVID-19) and provided information on
financial liquidity.
“At Ingevity, our number one priority is the health and safety
of our employees,” said Rick Kelson, Ingevity’s chairman of the
board, and interim president and CEO. “We are also working
diligently to exercise our business continuity plans so that we can
continue to supply our customers,” he continued. “And, we remain
confident in our financial position and our liquidity is
strong.
“In fact, Ingevity’s first quarter is progressing somewhat
better than expected, despite moderate headwinds from the
coronavirus,” he continued. “Nonetheless, the situation is and will
be very dynamic as we move through the rest of the year.”
Employee Health
- All non-production and non-essential laboratory employees with
remote access capability have been instructed to work from home.
Social distancing measures limiting the number of employees in labs
and meetings have been instituted.
- The company has implemented a ban on all non-essential
international and domestic business travel.
- Employees returning from business or personal travel
internationally or to highly-impacted areas in the U.S. are
instructed to self-quarantine for 14 days prior to returning to any
company location.
- The company has stopped visits to the company’s locations by
non-employees who have traveled internationally and to other
heavily-impacted areas in the U.S. within the past two weeks.
- To date, no domestic or international employees have tested
positive for COVID-19.
Manufacturing Operations
- Operations at the company’s manufacturing locations in China
(Zhuhai, Changshu) resumed following the Chinese New Year in full
force on February 10. These plants continue to run at a rate
necessary to meet customer orders which remain steady.
- The company’s U.S. and U.K. manufacturing locations continue to
run normally with no decreases in production. Plans are in
development to adjust production to market needs if necessary.
- The company’s manufacturing plants are not experiencing any
issues in obtaining raw materials.
- All of Ingevity’s manufacturing facilities have pandemic
response and business continuity plans in place. Plant leaders are
reviewing and preparing to implement those plans if and when
necessary.
- The kiln replacement outage at the Covington, Va., activated
carbon facility previously scheduled for April is being delayed
until the fall to ensure that it proceeds without
interruption.
Financial Status and
Liquidity
- To date, net debt to adjusted earnings before interest, taxes,
depreciation and amortization (EBITDA) is unchanged from the end of
2019 at 2.8x. Ingevity has maintained this moderate leverage
despite its typical first quarter cash consumption in preparation
for the paving season. This leverage also reflects the company’s
strong focus on cash collections.
- Ingevity has a significant $750 million revolver of which $620
million was available at year end. Out of an abundance of caution,
the company recently withdrew $250 million from this revolver.
- Excluding commitments to letters of credit, approximately $350
million of additional funds are available to the company.
- Moody’s recently upgraded Ingevity’s outlook from negative to
stable as a result of its deleveraging since its acquisition of the
Capa® caprolactones business from Perstorp AB.
Ingevity: Purify, Protect and Enhance
Ingevity provides specialty chemicals, high-performance carbon
materials and engineered polymers that purify, protect and enhance
the world around us. Through a team of talented and experienced
people, Ingevity develops, manufactures, and brings to market
products and processes that help customers solve complex problems.
These products are used in a variety of demanding applications,
including asphalt paving, oil exploration and production,
agrochemicals, adhesives, lubricants, publication inks, coatings,
elastomers, bio-plastics and automotive components that reduce
gasoline vapor emissions. Headquartered in North Charleston, South
Carolina, Ingevity operates from 25 locations around the world and
employs approximately 1,850 people. The company is traded on the
New York Stock Exchange (NYSE: NGVT). For more information visit
www.ingevity.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the Securities Exchange Act of 1934, as amended, and
the Private Securities Litigation Reform Act of 1995. Such forward
looking statements generally include the words “may,” “could,”
“should,” “believes,” “plans,” “intends,” “targets,” “will,”
“expects,” “suggests,” “anticipates,” “outlook,” “continues,”
“forecast,” “prospect,” “potential” or similar expressions.
Forward-looking statements may include, without limitation,
expected financial positions, results of operations and cash flows;
financing plans; business strategies and expectations; operating
plans; impact of coronavirus; synergies and the potential benefits
of the acquisition of Perstorp Holding AB’s Capa caprolactone
business (the “acquisition”); capital and other expenditures;
competitive positions; growth opportunities for existing products;
benefits from new technology and cost-reduction initiatives, plans
and objectives; markets for securities and expected future
repurchases of shares, including statements about the manner,
amount and timing of repurchases. Like other businesses, Ingevity
is subject to risks and uncertainties that could cause its actual
results to differ materially from its expectations or that could
cause other forward-looking statements to prove incorrect. Factors
that could cause actual results to materially differ from those
contained in the forward-looking statements, or that could cause
other forward-looking statements to prove incorrect, include,
without limitation, risks that the expected benefits from the
acquisition will not be realized or will not be realized in the
expected time period; the risk that the acquired business will not
be integrated successfully; significant transaction costs; unknown
or understated liabilities; general economic and financial
conditions; international sales and operations; currency exchange
rates and currency devaluation; compliance with U.S. and foreign
regulations; competition from infringing intellectual property
activity; attracting and retaining key personnel; changes in trade
policy, including the imposition of tariffs; the impact of the
United Kingdom’s withdrawal from the European Union; conditions in
the automotive market or adoption of alternative technologies;
worldwide air quality standards; a decrease in government
infrastructure spending; declining volumes and downward pricing in
the printing inks market; the limited supply of crude tall oil
(“CTO”); lack of access to sufficient CTO; access to and pricing of
raw materials; competition from producers of alternative products
and new technologies, and new or emerging competitors; a prolonged
period of low energy prices; the provision of services by third
parties at several facilities; natural disasters, such as
hurricanes, winter or tropical storms, earthquakes, floods, fires;
the adverse effect of the coronavirus on our global sales and
operations, demand for our automotive carbon products, and our
manufacturing facilities and supply chain; other unanticipated
problems such as labor difficulties including renewal of collective
bargaining agreements, equipment failure or unscheduled maintenance
and repair; protection of intellectual property and proprietary
information; information technology security breaches and other
disruptions; government policies and regulations, including, but
not limited to, those affecting the environment, climate change,
tax policies, tariffs and the chemicals industry; and lawsuits
arising out of environmental damage or personal injuries associated
with chemical or other manufacturing processes. These and other
important factors that could cause actual results or events to
differ materially from those expressed in forward-looking
statements that may have been made in this document are and will be
more particularly described in our filings with the U.S. Securities
and Exchange Commission, including our Form 10-K for the year ended
December 31, 2019 and our other periodic filings. Readers are
cautioned not to place undue reliance on Ingevity’s projections and
forward-looking statements, which speak only as the date thereof.
Ingevity undertakes no obligation to publicly release any revision
to the projections and forward-looking statements contained in this
press release, or to update them to reflect events or circumstances
occurring after the date of this announcement.
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version on businesswire.com: https://www.businesswire.com/news/home/20200323005154/en/
Jack Maurer 843-746-8242
jack.maurer@ingevity.com
Investors: Dan
Gallagher 843-740-2126 daniel.gallagher@ingevity.com
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