vvv-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________

FORM 10-Q

(Mark one)


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to ___________

Commission file number 001-37884

VALVOLINE INC.

(Exact name of registrant as specified in its charter)


Kentucky			30-0939371
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

100 Valvoline Way, Suite 100

Lexington, Kentucky 40509

(Address of principal executive offices) (Zip Code)

Telephone Number (859) 357-7777

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

VVV

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No þ

At August 4, 2023, there were 138,662,731 shares of the registrant’s common stock outstanding.

TABLE OF CONTENTS


			Page
PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (Unaudited)

Condensed Consolidated Statements of Comprehensive Income			3

Condensed Consolidated Balance Sheets			4

Condensed Consolidated Statements of Cash Flows			5

Condensed Consolidated Statements of Stockholders' Equity			6

Notes to Condensed Consolidated Financial Statements			8

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			20

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			32

ITEM 4. CONTROLS AND PROCEDURES			32

ITEM 5. OTHER INFORMATION			33

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS			34

ITEM 1A. RISK FACTORS			34

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS			34

ITEM 6. EXHIBITS			36

SIGNATURE			37

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Valvoline Inc. and Consolidated Subsidiaries

Condensed Consolidated Statements of Comprehensive Income


	Three months ended June 30				Nine months ended June 30
(In millions, except per share amounts - unaudited)	2023		2022		2023		2022
Net revenues	$	376.2	$	317.4	$	1,053.5	$	900.7
Cost of sales	225.5		189.6		657.3		553.4
Gross profit	150.7		127.8		396.2		347.3

Selling, general and administrative expenses	65.6		59.2		194.2		182.6
Net legacy and separation-related expenses	1.6		9.9		30.8		18.9
Other income, net	(3.0)		(2.4)		(5.8)		(7.3)
Operating income	86.5		61.1		177.0		153.1
Net pension and other postretirement plan expense (income)	3.7		(9.2)		11.0		(27.7)
Net interest and other financing (income) expense	(4.6)		17.3		27.4		51.2
Income before income taxes	87.4		53.0		138.6		129.6
Income tax expense	22.9		13.2		14.2		32.6
Income from continuing operations	64.5		39.8		124.4		97.0
(Loss) income from discontinued operations	(2.9)		58.4		1,246.4		169.6
Net income	$	61.6	$	98.2	$	1,370.8	$	266.6

Net earnings per share
Basic earnings (loss) per share
Continuing operations	0.40		0.22		0.74		0.54
Discontinued operations	(0.02)		0.33		7.35		0.94
Basic earnings per share	$	0.38	$	0.55	$	8.09	$	1.48

Diluted earnings (loss) per share
Continuing operations	0.40		0.22		0.73		0.53
Discontinued operations	(0.02)		0.33		7.31		0.94
Diluted earnings per share	$	0.38	$	0.55	$	8.04	$	1.47

Weighted average common shares outstanding
Basic	161.5		178.6		169.5		179.6
Diluted	162.5		179.8		170.6		180.9

Comprehensive income
Net income	$	61.6	$	98.2	$	1,370.8	$	266.6
Other comprehensive income (loss), net of tax
Currency translation adjustments	1.0		(19.4)		45.5		(19.7)
Amortization of pension and other postretirement plan prior service credits	(0.4)		(0.5)		(1.3)		(1.3)
Unrealized (loss) gain on cash flow hedges	(1.5)		1.9		(5.9)		10.3
Other comprehensive (loss) income	(0.9)		(18.0)		38.3		(10.7)
Comprehensive income	$	60.7	$	80.2	$	1,409.1	$	255.9

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these Condensed Consolidated Financial Statements.

Valvoline Inc. and Consolidated Subsidiaries

Condensed Consolidated Balance Sheets

(In millions, except per share amounts - unaudited)

June 30
2023

September 30
2022

Assets

Current assets

Cash and cash equivalents

526.7

SEC Form 10-Q filed by Valvoline Inc.